BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Transcription

1 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison Company (U 338-E) for Approval of Green Energy Programs. Application No APPLICATION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E) FOR APPROVAL OF GREEN ENERGY PROGRAMS JANET S. COMBS REBECCA MEIERS-DE PASTINO MARIO E. DOMINGUEZ Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California Telephone: (626) Facsimile: (626) Dated: September 26, 2018

2 APPLICATION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E) FOR APPROVAL OF GREEN ENERGY PROGRAMS TABLE OF CONTENTS Section Page I. INTRODUCTION...1 II. EXECUTIVE SUMMARY...2 A. Legislative and Regulatory Background and Guiding Principles...2 B. Green Energy Programs Guiding Principles Green Energy Programs Overview Green Energy Programs Rate Design Green Energy Programs Procurement Marketing, Education and Outreach (ME&O) Costs and Cost Recovery...7 III. SUMMARY OF REQUESTS...9 IV. ORGANIZATION OF SCE S TESTIMONY...12 V. STATUTORY AND PROCEDURAL REQUIREMENTS...12 A. Statutory and Other Authority...12 B. Legal Name and Correspondence Rules 2.1(a) and 2.1(b)...13 C. Categorization, Hearings, and Issues to be Considered Rule 2.1(c) Proposed Category Need for Hearings Issues to be Considered, Including Relevant Safety Considerations Proposed Schedule...15 D. Organization, Qualification to Transact Business and Articles of Incorporation Rule i-

3 APPLICATION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E) FOR APPROVAL OF GREEN ENERGY PROGRAMS TABLE OF CONTENTS (CONTINUED) Section Page E. Balance Sheet and Income Statement Rule 3.2(a)(1)...18 F. Statement of Presently Effective and Proposed Rates Rules 3.2(a)(2) and 3.2(a)(3)...18 G. Description of SCE s Service Territory and Utility System Rule 3.2(a)(4)...19 H. Summary of Earnings Rule 3.2(a)(5)...19 I. Depreciation...19 J. Capital Stock and Proxy Statement Rule 3.2(a)(8)...19 K. Statement Pursuant to Rule 3.2(a)(10)...19 L. Service of Notice Rule 3.2(b), (c) and (d)...20 M. Index of Exhibits and Appendices in This Application...20 N. Service List...21 APPENDIX A BALANCE SHEET AND INCOME STATEMENT APPENDIX B SUMMARY OF EARNINGS APPENDIX C LIST OF CITIES AND COUNTIES -ii-

4 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison Company (U 338-E) for Approval of Green Energy Programs. Application No APPLICATION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E) FOR APPROVAL OF GREEN ENERGY PROGRAMS I. INTRODUCTION Pursuant to Articles 1 and 2 of the Rules of Practice and Procedure of the California Public Utilities Commission (Commission or CPUC), Southern California Edison Company (SCE) respectfully files this Application requesting Commission approval to implement and recover the up to $5.87 million in implementation, administration and marketing costs associated with five new green energy programs (collectively, the Green Energy Programs) that allow customers the opportunity to use renewable energy resources to meet their electricity needs, as more fully described herein. The Green Energy Programs will replace SCE s existing Green Tariff Shared Renewables (GTSR) program once the Green Energy Programs are implemented in SCE s proposed new Green Energy Programs are summarized in this Application and in discussed in detail supporting testimony (preliminarily identified as Exhibit SCE-01). The supporting testimony also explains SCE s proposed cost recovery and ratemaking treatment for the proposed Green Energy Programs. 1

5 II. EXECUTIVE SUMMARY A. Legislative and Regulatory Background and Guiding Principles Senate Bill (SB) 43, codified as California Public Utilities Code section 2831 et seq., enacted the GTSR program. The express purpose of SB 43 was to provide a mechanism that would allow customers who could not take advantage of the Net Energy Metering (NEM) program, including lower income customers and large energy users such as the military, universities, local governments, and commercial customers, to meet their energy needs with generation from eligible renewable energy resources. 1 To that end, Decision (D.) implemented the provisions of SB 43 by creating the existing GTSR program, which consists of (1) a Green Rate that allows SCE to procure green energy to serve 50% or 100% of participating bundled customers load; and (2) an ECR program in which a developer enters into a PPA with SCE and participating customers and SCE applies a credit on the participating customers bills to offset the developer s energy charges. Numerous barriers for customers and developers, including program caps and sizing restrictions, make it difficult for SCE to subscribe customers to either GTSR program. With specific regard to the GTSR Green Rate, the primary barrier is that SCE must recover the program costs in rates only from participating customers instead of across all customers, resulting in higher premiums for participating customers. On December 22, 2017, SCE filed Advice Letter 3722-E requesting authority to sunset its GTSR program as of December 31, 2018, due to the low number of participating customers in the GTSR program. This Application, supported by SCE s testimony, seeks to replace the GTSR program with five new programs without the barriers that have frustrated the GTSR program s success. Because SCE s Application is not expected to be resolved by December 31, 2018, SCE 1 Cal. Pub. Util. Code 2831(b), (f), (o). 2

6 will supplement its Advice Letter to keep the existing GTSR program available to customers until new programs are available to SCE s customers. B. Green Energy Programs 1. Guiding Principles Based on SCE s experience with the GTSR program, customer feedback, and research, SCE concluded that there is a customer desire for green energy programs and that the GTSR program was not realizing SB 43 s legislative intent of increasing access to renewable energy programs to all types of customers. Accordingly, SCE created guiding principles in developing the Green Energy Programs to replace the GTSR program, and to reduce or eliminate the barriers that are impeding customers ability to access renewable energy programs and options. SCE developed a suite of options to match the wide range of customers goals and requirements and to facilitate customer choice. Additionally, the Green Energy Programs increase cap levels that hindered certain customer segments ability to participate in programs and satisfy their renewable energy goals and requirements. Importantly, the Green Energy Programs are designed with the intent and purpose of supporting the State s energy and environmental policy goals, including California s GHG emission reduction goals and goals for advancing renewable energy options for low-income customers and Disadvantage Communities. 2. Green Energy Programs Overview The new Green Energy Programs SCE proposes are all uniquely designed to match a diverse customer base and meet the various goals and objectives outlined above. Bundled service customers will be eligible to subscribe and unsubscribe at any time within SCE s standard tariffed rate change rules. 2 As more fully explained in the supporting testimony, as generation programs, the Green Energy Programs will not be available to Direct Access (DA), 2 See SCE Tariff Rule 12. 3

7 Community Choice Aggregator (CCA), or Community Aggregation (CA) customers, and certain other specific customer classifications as identified in the supporting testimony. The new Green Energy Programs are summarized as follows: 1. New Green Tariff One-hundred percent of the customer s energy needs are sourced by a portfolio of utility-scale renewables projects. Various aspects of the proposed tariff and cost recovery approach enable SCE to offer a rate that is expected to be more economic than the Green Tariff portion of the current GTSR program; 2. Plus Green Tariff SCE offsets the non-renewable portion of a participating customers load with the retirement of unbundled Renewable Energy Credits (RECs), which match the non-renewable bundled energy SCE delivers to the participating customers. These customers will incur additional charges that cover the costs of the RECs; 3. New Community Renewables Electricity from a dedicated renewable energy generating facility will be procured to supply power to a defined community. One or more large business or government customers in the community must sponsor the facility and commit to purchase a minimum of 80 percent of the facility s output, with the remainder made available to residential and small business customers in the community; 4. Green Direct Large business and government customers are supplied by a dedicated third-party renewable energy generating facility to meet some or all of their needs and renewable energy goals and pay the associated costs of the dedicated facility; and 5. Customer-Controlled Renewables SCE will offer Inter-Scheduling Coordinator Trades (ISTs) with large customers that are delivering renewable energy into the California Independent System Operator s (CAISO) wholesale market and earning market revenues, and include those customers market revenues on their SCE bills as a bill credit. 4

8 Appendix B to Exhibit SCE-01 provides a detailed chart summarizing and comparing the features of all five Green Energy Programs. 3. Green Energy Programs Rate Design SCE proposes to reduce the barriers of the GTSR program with a unique rate design for three of the five programs. The GTSR program results in higher rates primarily because of the: (1) adjusted generation credit, and (2) renewable power price. The rate design for the New Green Tariff, New Community Renewables, and Green Direct programs is conceptually similar to rates for SCE customers who receive generation service from SCE, but not from SCE s bundled generation portfolio. The proposed rate structure consists of three components: (1) delivery charges, (2) indifference adjustment, and (3) a generation rate reflecting the portfolio of renewable resources serving customers on these three Green Rate Programs. Customers will not be assessed a bundled generation charge, thus eliminating the need for an adjusted generation credit. SCE expects the proposed rate structure to improve bill impacts to participating customers and create a simpler and easier to understand tariff and bill for customers. SCE also proposes to offer a discount on the cost of participating in an eligible Green Energy Program for qualifying participants to complement the program for Disadvantaged Communities (DAC) adopted in D Specifically, SCE proposes a 10 percent transition credit bill discount to CARE/FERA participants who do not live in the DACs that qualify for the D discount. Consistent with the current GTSR framework, the DAC credit is limited to 45 MW of total enrollment. 4. Green Energy Programs Procurement Several of the new Green Energy Programs require SCE to engage in procurement of renewable resources. At this time, the Green Energy Programs are for Renewables Portfolio Standard (RPS)-eligible resources. However, SCE seeks authority to update the features of the Green Energy Programs, including eligible resources, by Tier 2 advice letters. With regard to 5

9 procurement for the Green Energy Programs, other than for the Plus Green Tariff, SCE proposes to use the RPS pro forma contract that was approved in its most recent RPS Plan, with Green Energy Program-specific riders. SCE does not currently have a pro forma contract for REC purchases for the Plus Green Tariff program. Upon approval of this Application, SCE proposes to file a Tier 2 advice letter that includes the form of Plus Green Tariff REC tariffed contract, tariff riders and solicitation materials. 5. Marketing, Education and Outreach (ME&O) SCE s primary marketing objective is to build awareness and generate enrollment. SCE will leverage proven marketing tactics and proactively explore new opportunities and untapped channels to reach all eligible customers. In addition to building awareness and generating enrollment, SCE s ME&O Plan aims to achieve the following objectives: Prioritize the most effective types of communications and customize messaging to targeted audiences; Use segmentation to identify target audiences; Provide a simple and easy enrollment experience; and Integrate with ME&O for other programs, such as CARE and FERA. SCE will achieve these objectives, in part, by reaching customers through multi-dimensional marketing efforts that use a mix of strategies and channels to reach customers by their preferred method of communication. To make customers aware of the new Green Energy Programs, SCE plans to use a combination of: (1) broad-based ME&O (e.g., print, radio, etc.) and online engagement (e.g., digital display, SCE.com, social media, search engine marketing, etc.) directed at all customers, and (2) tailored direct outreach through channels such as direct mail, , person-to-person interactions, 3 bill inserts, and others. SCE also will leverage grassroots efforts, 3 Person-to-person interactions in the context of SCE s ME&O Plan refers to in-person meetings in which SCE Business Account Managers may provide information on upcoming green rate program offerings to their customers. 6

10 such as events with community-based organizations (CBOs), to increase awareness of the programs. 6. Costs and Cost Recovery To implement the new Green Rate Programs as proposed in this Application starting in 2021, SCE seeks authority to recover in its rates up to $4.20 million in estimated incremental administration and marketing costs through 2023, and up to $1.67 million in estimated incremental costs of billing system changes. Commencing in 2024, SCE proposes to recover the administration, marketing, and implementation costs of the new Green Rate Programs in Phase 1 of its General Rate Case (GRC). SCE also seeks authority to offer the 10% discount (or transition credits) for qualifying CARE/FERA participants, estimated at $7.3 million (nominal) through Procurement costs (PPA and REC costs) are not included in this Application. SCE will file signed Power Purchase Agreements (PPAs) for the new Green Rate Programs for Commission review and approval via Tier 2 advice letters, consistent with the existing process for SCE s GTSR program. Once approved, SCE proposes to record the PPA costs and revenues collected from participating customers in the Green Energy Programs Balancing Account (GEPBA). For REC purchases, SCE requests Commission approval to procure, retire, and otherwise transact unbundled RECs using processes and procedures analogous to some methods of SCE s Conformed 2014 Bundled Procurement Plan (BPP). 4 Specifically, SCE intends to procure RECs for this program in four ways, (1) using Commission-authorized brokers, (2) competitive solicitations, (3) bilateral transactions, and (4) purchases from SCE s portfolio of RECs that SCE does not need to satisfy compliance obligations. Thereafter, SCE proposes the 4 Although SCE requests authority to transact and retire this product, SCE s Application is not requesting the Commission amend the BPP to include unbundled RECs as an approved product. Rather, SCE seeks for authority to transact and retire RECs using the processes and procedures discussed below solely for the purpose of meeting the needs of the Plus Green program and to transfer excess bundled portfolio RECs procured for the purposes of RPS compliance. 7

11 Commission perform an accounting, not an after-the-fact reasonableness, review of the transactions in SCE s annual Energy Resource Recovery Account (ERRA) Review proceeding to determine if the expenses and participating customers revenues are eligible to be recovered through the GEPBA balancing account SCE requests authority to establish in this Application. The GEPBA will also record the transition credits. Accordingly, while SCE does not seek recovery of procurement costs (PPA and REC costs) in this Application, SCE does request authority to establish a new two-way balancing account, the Green Energy Programs Balancing Account (GEPBA), which will operate beginning in 2021 with the implementation of the Green Rate Programs. SCE proposes to establish the GEPBA to record the difference between the recorded Green Energy Programs procurement-related costs (PPA and REC costs), including the 10% discounts (revenue shortfall) for transition credits where applicable, and the recorded generation-related revenue collected from participating customers. The GEPBA will consist of distinct sub-accounts that will separately track the energy costs, revenues and credits, if applicable, for the Green Energy Programs and any separate projects under Green Direct and New Community Renewables programs, as described above. The billed revenues recorded in this balancing account will be based on a cents per kwh charge for each kwh of energy delivered per a participating customer s Green Energy Program subscription. Each renewable energy component of the Green Energy Program rates, for example PPA prices, REC costs, Resource Adequacy (RA), and load balancing costs, will be set based on forecast costs. Actual recorded costs, however, will likely be higher or lower than estimated. As a result, SCE will need to record the resulting over-collection or under-collection in the new balancing account separately for each Green Energy Program. The operation of the new balancing account will allow SCE to true up the following year s renewable generation rates for any prior year over- or under- collection. In addition, SCE proposes the establishment of a new one-way balancing account, the Green Energy Programs Administration and Marketing Balancing Account (GEPAMBA) to 8

12 record 1) startup and ongoing program administrative costs, and 2) ME&O costs associated with implementing the Green Energy Programs. The GEPAMBA will record the initial and on-going incremental administrative costs associated with the Green Energy Programs, which may include IT-related system enhancements, customer communication materials and training, program management, enrollment processing and RFO solicitation and independent evaluator. The GEPAMBA will also record the initial and ongoing incremental ME&O costs incurred in order to implement the new Green Energy Programs described in this application. Similar to many of SCE s authorized balancing and memorandum accounts, the recorded operation of the GEPBA and the GEPAMBA will be reviewed in SCE s annual April ERRA Review application and should be limited to a review to ensure that all entries to the accounts are stated correctly and are associated with the Green Energy Programs costs and activities as defined and approved by the Commission. Because the Commission will perform a full reasonableness review of the administration and ME&O costs in this proceeding; adopt the four methods for procuring unbundled RECs for the Plus Green program, with purchases reviewed annually in SCE s ERRA Review proceeding; and adopt processes for soliciting, selecting and executing PPAs for the New Green Tariff, Green Direct and New Community Renewables programs, which will be reviewed by the Commission via a Tier 2 advice letter process, as is currently the case for ECR PPAs, after-the-fact reasonableness review will not be required. III. SUMMARY OF REQUESTS For the reasons set forth herein and in the supporting testimony (Exhibit SCE-01), SCE requests that the Commission: Find that the Green Energy Programs are reasonable; Find that the forecasted cost of $5.875 million (2018 Constant $) for the Green Energy Programs through 2023, comprised of $4.20 million (2018 Constant $) in 9

13 operations and maintenance (O&M) costs, and $1.67 (2018 Constant $) million in implementation costs, are reasonable; Find that the 10 percent discount on the cost of participating in an eligible Green Energy Program for qualifying CARE/FERA participants, estimated at $7.3 million (nominal) through 2030, is reasonable. Authorize SCE to implement the Green Energy Programs as proposed in this Application and recover up to $5.875 million in administration, marketing and implementation costs through 2023, and authorize SCE to recover these costs starting in 2024 through Phase 1 of SCE s GRC; Approve SCE s plan to discontinue its existing GTSR program once SCE implements the new Green Rate Programs in 2021, and move then-participating GTSR customers to the New Green Tariff; however, any GTSR PPAs will continue until they expire or are terminated pursuant to their terms; Adopt the unique rate design for the New Green Tariff, New Community Renewables, and Green Direct Programs, including the 10% discount on the cost of participating in an eligible Green Energy Program for qualifying CARE/FERA participants (the transition credits); Authorize SCE to procure RECs for the Plus Green Tariff program using Commission-authorized brokers, competitive solicitations, bilateral transactions, and purchases from SCE s portfolio of RECs that SCE does not need to satisfy compliance obligations using a Commission-approved administratively set price, as described in Chapter IV of Exhibit SCE-01; Authorize a new two-way balancing account, the GEPBA, to record the difference between the recorded Green Energy Programs procurement-related costs (PPA and REC costs) and the recorded revenue collected from participating customers, as well as the transition credits. The GEPBA will consist of distinct sub-accounts that will separately track the energy costs, revenues and transition (bill) credits if applicable, for each of the Green Energy Programs and for separate projects under the Green 10

14 Direct and New Community Renewables Program involving renewable generation rates; Authorize a new one-way balancing account, the Green Energy Programs Administration and Marketing Balancing Account (GEPAMBA), to record 1) startup and ongoing program administrative costs, and 2) Marketing, Education and Outreach (ME&O) costs associated with implementing the Green Energy Programs up to $5.875 million through 2023, and to include these costs in Phase 1 of its GRC starting in 2024; Find that no after-the-fact reasonableness review is required because the Commission in this proceeding will perform a full reasonableness review of the implementation, administration and ME&O costs in this proceeding; adopt the four methods for procuring unbundled RECs for the Plus Green program, which purchases will be reviewed annually in SCE s ERRA Review; and adopt a processes for soliciting, selecting and executing PPAs for the New Green Tariff, Green Direct and New Community Renewables programs, which will be reviewed by the Commission via a Tier 2 advice letter process as is currently the case for PPAs for the Enhanced Community Renewables (ECR) segment of the GTSR; Authorize SCE to update the features of the Green Energy Programs, including eligible resources, by Tier 2 advice letters; Authorize SCE to submit Tier 2 advice letters for approval of Request for Offer (RFO) materials, Green Energy Program-specific riders, and Plus Green Tariff REC pro forma contract within 120 days of the date it issues the final decision in this proceeding; Authorize SCE to obtain approval for recovery of the executed PPAs for all Green Energy Programs by Tier 2 advice letter; Authorize SCE to file a Tier 2 Advice Letter for approval of its Plus Green Tariff non-negotiable contract within 120 days of the date it issues the final decision in this proceeding; Grant any other relief the Commission deems reasonable or necessary. 11

15 IV. ORGANIZATION OF SCE S TESTIMONY SCE s support testimony in Exhibit SCE-is organized in a single volume with ten chapters as follows: Chapter I: Introduction and Executive Summary Chapter II: Legislative and Regulatory Background and Guiding Principles Chapter III: New Green Tariff Program Chapter IV: Plus Green Chapter V: Green Direct Chapter VI: New Community Renewables Program Chapter VII: Customer-Controlled Renewables Program Chapter VIII: Rate Design Chapter IX: Marketing, Education & Outreach (ME&O) Chapter X: Green Energy Programs Cost Recovery Proposal V. STATUTORY AND PROCEDURAL REQUIREMENTS A. Statutory and Other Authority This Application is made pursuant to the Commission s Rules of Practice and Procedure, and the California Public Utilities Code. SCE s request complies with the Commission s Rules of Practice and Procedure, Rules 1.5 through 1.11 and 1.13, which specify the procedures for, among other things, filing documents. In addition, this request complies with Rules 2.1, 2.2, and 3.2. Rule 2.1 requires that all applications: (1) clearly and concisely state authority or relief sought; (2) cite the statutory or other authority under which that relief is sought; and (3) be verified by the applicant. Rule 2.1 sets forth further requirements addressed separately below. 12

16 The relief being sought is summarized above in Sections I (Introduction and Executive Summary) and II (Overview of SCE s Application), and is further described in the testimony (Exhibit SCE-01) supporting this Application. The statutory and other authority for this request includes, but is not limited to, California Public Utilities Code Sections 451, 454, 454.3, 491, 701, 702, 728, 729, Article 2 and Rule 3.2 of the Commission s Rules of Practice and Procedure, and prior decisions, orders, and resolutions of this Commission. SCE s Application has been verified by an SCE officer as provided in Rules 1.11 and 2.1. B. Legal Name and Correspondence Rules 2.1(a) and 2.1(b) The legal name of the Applicant is Southern California Edison Company. SCE is a corporation organized and existing under the laws of the State of California, and is primarily engaged in the business of generating, purchasing, transmitting, distributing, and selling electric energy for light, heat, and power in portions of central and southern California as a public utility subject to the jurisdiction of the California Public Utilities Commission. SCE s properties, which are located primarily within the State of California, consist mainly of hydroelectric and thermal electric generating plants, together with transmission and distribution lines and other property necessary in connection with its business. SCE s principal place of business is 2244 Walnut Grove Avenue, Rosemead, California, and its post office address and telephone number are: Southern California Edison Company Post Office Box 800 Rosemead, California Telephone: (626) SCE s attorney in this matter is Rebecca Meiers-De Pastino. Correspondence or communications regarding this Application should be addressed to: 13

17 Rebecca Meiers-De Pastino Southern California Edison Company P.O. Box Walnut Grove Avenue Rosemead, California Telephone: (626) Facsimile: (626) SCE Case Administration Southern California Edison Company 8631 Rush Street Rosemead, California Telephone: (626) Facsimile: (626) C. Categorization, Hearings, and Issues to be Considered Rule 2.1(c) 1. Proposed Category Rule 1.3(e) of the Commission s Rules of Practice and Procedure defines ratesetting proceedings as proceedings in which the Commission sets or investigates rates for a specifically named utility (or utilities), or establishes a mechanism that in turn sets the rates for a specifically named utility (or utilities). This Application will include the setting and investigation of rates, and includes SCE s proposal for a ratemaking mechanism that will influence setting rates in future Applications. Therefore, for purposes of Rule 2.1, SCE proposes this proceeding be categorized as ratesetting. 2. Need for Hearings The need for hearings in this proceeding, and the issues to be considered in such hearings, will depend largely on the degree to which other parties contest SCE s request. SCE s proposed procedural schedule below assumes evidentiary hearings will be held; however, the need for hearings will be determined by the assigned Administrative Law Judge(s). 3. Issues to be Considered, Including Relevant Safety Considerations The primary issue to be considered in this proceeding is the reasonableness of SCE s Green Energy Programs as described in Sections I (Executive Summary) and II (Overview of SCE s Application) above and in more detail in SCE s supporting testimony served concurrently with this Application. 14

18 D approved an amendment to Rule 2.1(c) of the Commission s Rules of Practice and Procedure (Title 20, Division 1, of the California Code of Regulations) to require all applications to identify all relevant safety considerations implicated by the application. One of SCE s core values is to assure public and employee safety. As such, any procurement for the Green Energy Programs (whether for SCE-owned units, contracted through Power Purchase Agreements, or purchased through CAISO or other power exchanges), inherently assumes that all power providers are fully compliant with laws, rules, regulations and internally-managed controls to assure that their generating facilities are operated and maintained in a safe working condition. Likewise, SCE s management of air emissions costs (i.e., Greenhouse Gas Cap-and- Trade costs and other similar costs), and transmission capacity procurement activities, also assume the counter-parties to these transactions are fully compliant with laws, rules, regulations and internally-managed controls to assure that their facilities are operated and maintained in a safe working condition. Costs incurred by SCE to operate and maintain the SCE office and public spaces, shops, warehouses, transmission and distribution facilities, and utility-owned power plants in a safe condition are reviewed in Phase 1 of SCE s General Rate Case (GRC) Applications. In addition, per D , SCE filed a Safety Model Assessment Proceeding (SMAP) Application to provide Commission staff and other parties with the opportunity to analyze and understand the various models and methodologies that the energy utilities will be using to prioritize safety in their GRC proceedings. This prioritization of safety is to be achieved through the use of models and methodologies to assess the energy utility s risk, and the mitigation measures the energy utility plans to take to reduce and minimize such risks. 4. Proposed Schedule The primary issue to be considered in this proceeding is the reasonableness of SCE s Green Energy Programs, including request for authorization to record and recover the costs associated with implementing, administering, and marketing the Green Energy Programs 15

19 through To allow the Commission to issue a timely final decision in this proceeding, SCE respectfully requests that the Commission process the Application according to this schedule: Event Date SCE files Application September 26, 2018 Daily Calendar Notice Appears October 9, 2018 Protests / Responses to Application November 8, 2018 Reply to Protests / Responses November 19, 2018 Prehearing Conference December 5, 2018 Intervener Testimony Due January 11, 2019 Rebuttal or Reply Testimony Due February 1, 2019 Evidentiary Hearings (if necessary) February 12-14, 2019 Concurrent Opening Briefs March 1, 2019 Reply Briefs March 22, 2019 Commission issues Proposed Decision April 26, 2019 Comments to Proposed Decision May 16, 2019 Replies to Comments to Proposed Decision May 21, 2019 Commission issues Final Decision June 2019 D. Organization, Qualification to Transact Business and Articles of Incorporation Rule 2.2 In compliance with Rule 2.2 of the Commission s Rules of Practice and Procedure, 5 a copy of SCE s Certificate of Restated Articles of Incorporation, effective on March 2, 2006, and presently in effect, certified by the California Secretary of State, was filed with the Commission on March 14, 2006, in connection with Application No , and is by reference made a part hereof. 5 Rule 2.2 requires the applicant, in this case SCE, to submit a copy of its organizing documents and evidence of its qualification to transact business in California, or to refer to that documentation if previously filed with the Commission. 16

20 A copy of SCE s Certificate of Determination of Preferences of the Series D Preference Stock filed with the California Secretary of State on March 7, 2011, and presently in effect, certified by the California Secretary of State, was filed with the Commission on April 1, 2011, in connection with Application No , and is by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series E Preference Stock filed with the California Secretary of State on January 12, 2012, and a copy of SCE s Certificate of Increase of Authorized Shares of the Series E Preference Stock filed with the California Secretary of State on January 31, 2012, and presently in effect, certified by the California Secretary of State, were filed with the Commission on March 5, 2012, in connection with Application No , and are by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series F Preference Stock filed with the California Secretary of State on May 5, 2012, and presently in effect, certified by the California Secretary of State, was filed with the Commission on June 29, 2012, in connection with Application No , and is by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series G Preference Stock filed with the California Secretary of State on January 24, 2013, and presently in effect, certified by the California Secretary of State, was filed with the Commission on January 31, 2013, in connection with Application No , and is by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series H Preference Stock filed with the California Secretary of State on February 28, 2014, and presently in effect, certified by the California Secretary of State, was filed with the Commission on March 24, 2014, in connection with Application No , and is by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series J Preference Stock filed with the California Secretary of State on August 19, 2015, and presently in effect, certified by the California Secretary of State, was filed with the Commission on October 2, 2015, in connection with Application No , and is by reference made a part hereof. 17

21 A copy of SCE s Certificate of Determination of Preferences of the Series K Preference Stock, filed with the California Secretary of State on March 2, 2016, and presently in effect, certified by the California Secretary of State, was filed with the Commission on April 1, 2016, in connection with Application No , and is by reference made a part hereof. A copy of SCE s Certificate of Determination of Preferences of the Series L Preference Stock filed with the California Secretary of State on June 20, 2017, and presently in effect, certified by the California Secretary of State, was filed with the Commission on June 30, 2017, in connection with Application No , and is incorporated herein by this reference. Certain classes and series of SCE s capital stock are listed on a national securities exchange as defined in the Securities Exchange Act of 1934, and copies of SCE s latest Annual Report to Shareholders and its latest proxy statement sent to its stockholders has been filed with the Commission with a letter of transmittal dated March 16, 2018, pursuant to General Order Nos. 65-A and 104-A of the Commission. E. Balance Sheet and Income Statement Rule 3.2(a)(1) In compliance with Rule 3.2(a)(1), Appendix A to this Application contains copies of SCE s balance sheet as of June 30, 2018, and income statement for the period ending June 30, 2018, the most recent period available. F. Statement of Presently Effective and Proposed Rates Rules 3.2(a)(2) and 3.2(a)(3) The presently effective rates and the illustrative changes proposed to be made to those rates are discussed in SCE s supporting testimony (Exhibit SCE-01) served concurrently with this Application, and reflect rates as of June 1, Proposed rates are illustrative and will be updated consistent with the Commission s decision in this proceeding to reflect SCE s thencurrent authorized revenues when such rates are implemented. SCE s current rates and charges for electric service are in its electric tariffs and schedules on file with the Commission. These tariffs and schedules are filed with and made effective by the Commission in its decisions, 18

22 orders, resolutions, and approvals of advice letter filings pursuant to Commission General Order 96-A. SCE is not requesting a general revenue increase of over one percent in this Application. G. Description of SCE s Service Territory and Utility System Rule 3.2(a)(4) applicable. Because this Application is not a general rate case application, this requirement is not H. Summary of Earnings Rule 3.2(a)(5) In compliance with Rule 3.2(a)(5), Appendix B hereto contains a copy of SCE s summary of earnings, authorized in SCE s 2017 Post Test Year Advice Letter 3514-E, the most recent period available. I. Depreciation applicable. Because this Application is not a general rate case application, this requirement is not J. Capital Stock and Proxy Statement Rule 3.2(a)(8) applicable. Because this Application is not a general rate case application, this requirement is not K. Statement Pursuant to Rule 3.2(a)(10) Rule 3.2(a)(10) requires the applicant to state whether its request is limited to passing through to customers only increased costs to the corporation for the services or commodities furnished by it. This Application seeks only to pass through to SCE s customers the costs incurred by SCE in connection with administering the Green Energy Programs beginning in 2020 through 2023, and the costs of offering a ten percent discount of participating in an eligible Green Energy 19

23 Program for qualifying participants beginning in 2021 through SCE plans to seek recovery of these costs starting in 2024 in Phase 1 of SCE s GRC. L. Service of Notice Rule 3.2(b), (c) and (d) As required by California Public Utilities Code Section 454, a notice stating in general terms the proposed change will be provided to customers in their monthly bills. SCE has reviewed a draft of its proposed customer notice with the Commission s Public Advisor. As required by Rule 3.2(b), a notice stating in general terms the proposed rate change will be mailed to the designated officials of the State of California, and the cities and counties affected by the rate increase proposed in this Application as listed in Appendix C hereto. Pursuant to Rule 3.2(c), notice will be published in a newspaper of general circulation in each county in SCE s service territory within which the rate changes would be effective. The cities and counties affected by the rate increase proposed in this Application are shown in Appendix C hereto. Finally, pursuant to Rule 3.2(d), notice will be furnished to customers affected by the potential rate changes proposed in this Application by including such notice with the regular bills mailed to those customers and by electronically linking to such notice for customer that receive their bills electronically. M. Index of Exhibits and Appendices in This Application SCE s submission in support of this Application include the following, which are incorporated herein by reference: Appendices to Application Appendix A: Balance Sheet and Income Statement Appendix B: Summary of Earnings Appendix C. List of Cities and Counties 20

24 Exhibits to Application Exhibit SCE-01: Prepared Testimony in Support of Southern California Edison Company s Application for Approval of Green Energy Programs N. Service List The official service list has not yet been established in this proceeding. SCE is serving this Application and supporting testimony on the Commission s Public Advocates Office (formerly the Office of Ratepayer Advocates) and the service lists established by the Commission for proceedings A , R , and R Respectfully submitted, JANET S. COMBS REBECCA MEIERS-DE PASTINO MARIO E. DOMINGUEZ /s/ Rebecca Meiers-De Pastino By: Rebecca Meiers-De Pastino Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California Telephone: (626) Facsimile: (626) Rebecca.Meiers.Depastino@sce.com September 26,

25 VERIFICATION I am an officer of the applicant corporation herein, and am authorized to make this verification on its behalf. I am informed and believe that the matters stated in the foregoing document are true. I declare under penalty of perjury that the foregoing is true and correct. Executed this 25 th day of September, 2018, at Rosemead, California. By: /s/ Jill C. Anderson Jill C. Anderson Vice President, Customer Programs and Services SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770

26 Appendix A Balance Sheet and Income Statement

27 SOUTHERN CALIFORNIA EDISON COMPANY (h) A balance sheet as of the latest available date, together with an income statement covering the period from close of last year for which an annual report has been filed with the Commission to the date of the balance sheet attached to the application. STATEMENT OF INCOME SIX MONTHS ENDED JUNE 30, 2018 (In millions) OPERATING REVENUE $ 5,357 OPERATING EXPENSES: Purchase power and fuel 2,038 Other operation and maintenance 1,345 Depreciation, decommissioning and amortization 921 Property and other taxes 202 Other operating income (2) Total operating expenses 4,504 OPERATING INCOME 853 Interest expense (319) Other income and (expense) 101 INCOME BEFORE INCOME TAX 635 INCOME TAX (8) NET INCOME 643 Less: Preferred and preference stock dividend requirements 60 NET INCOME AVAILABLE FOR COMMON STOCK $ 583 A-1

28 SOUTHERN CALIFORNIA EDISON COMPANY BALANCE SHEET JUNE 30, 2018 ASSETS (in millions) UTILITY PLANT: Utility plant, at original cost $ 45,469 Less- accumulated provision for depreciation and decommissioning 9,370 36,099 Construction work in progress 3,522 Nuclear fuel, at amortized cost ,750 OTHER PROPERTY AND INVESTMENTS: Nonutility property - less accumulated depreciation of $73 75 Nuclear decommissioning trusts 4,294 Special Funds and Other investments 67 4,436 CURRENT ASSETS: Cash and equivalents 25 Receivables, less allowances of $53 for uncollectible accounts 806 Accrued unbilled revenue 598 Inventory 252 Income tax receivables 237 Prepaid expenses 244 Derivative assets 85 Regulatory assets 860 Other current assets 159 3,266 DEFERRED CHARGES: Regulatory assets 5,022 Other long-term assets 215 5,237 $ 52,689 A-2

29 SOUTHERN CALIFORNIA EDISON COMPANY BALANCE SHEET JUNE 30, 2018 CAPITALIZATION AND LIABILITIES (in millions) CAPITALIZATION: Common stock $ 2,168 Additional paid-in capital 676 Accumulated other comprehensive loss (21) Retained earnings 9,878 Common shareholder's equity 12,701 Preferred and preference stock 2,245 Long-term debt 12,107 Total capitalization 27,053 CURRENT LIABILITIES: Short-term debt 300 Current portion of long-term debt 479 Accounts payable 1,395 Accrued taxes 23 Customer deposits 291 Regulatory liabilities 1,341 Other current liabilities 1,093 4,922 DEFERRED CREDITS: Deferred income taxes and credits 6,143 Pensions and benefits 448 Asset retirement obligations 2,889 Regulatory liabilities 8,659 Other deferred credits and other long-term liabilities 2,575 20,714 $ 52,689 A-3

30 Appendix B Summary of Earnings

31 B-1

32 B-2

33 B-3

34 Appendix C List of Cities and Counties

35 State of California State of California Office of the Attorney General 1300 I Street #1101 Sacramento, CA Department of Ground Services Office of Buildings & Grounds 505 Van Ness Avenue, Room 2012 San Francisco, CA Cities and Counties Adelanto - City Attorney Air Expressway Adelanto, CA Agoura Hills - City Clerk Ladyface Court Agoura Hills, CA Aliso Viejo - City Attorney 12 Journey, Suite 100 Aliso Viejo, CA Apple Valley - City Clerk Dale Evans Parkway Apple Valley, CA Artesia - City Attorney Clarkdale Avenue Artesia, CA Avalon - City Clerk 410 Avalon Canyon Road Avalon, CA Barstow - City Attorney 220 East Mountain View Street #A Barstow, CA Beaumont - City Clerk 550 E. 6th Street Beaumont, CA Bell Gardens - City Attorney 7100 Garfield Ave. Bell Gardens, CA Bellflower - City Clerk Civic Center Drive Bellflower, CA Bishop - City Attorney 377 West Line Street Bishop, CA Adelanto - City Clerk Air Expressway Adelanto, CA Alhambra - City Attorney 111 S. First Street Alhambra, CA Aliso Viejo - City Clerk 12 Journey, Suite 100 Aliso Viejo, CA Arcadia - City Attorney P.O. Box Arcadia, CA Artesia - City Clerk Clarkdale Avenue Artesia, CA Baldwin Park - City Attorney E. Pacific Ave. Baldwin Park, CA Barstow - City Clerk 220 East Mountain View Street #A Barstow, CA Bell - City Attorney 6330 Pine Avenue Bell, CA Bell Gardens - City Clerk 7100 Garfield Ave. Bell Gardens, CA Beverly Hills - City Attorney 455 N Rexford Drive Beverly Hills, CA Bishop - City Clerk 377 West Line Street Bishop, CA Agoura Hills - City Attorney Ladyface Court Agoura Hills, CA Alhambra - City Clerk 111 S. First Street Alhambra, CA Apple Valley - City Attorney Dale Evans Parkway Apple Valley, CA Arcadia - City Clerk P.O. Box Arcadia, CA Avalon - City Attorney 410 Avalon Canyon Road Avalon, CA Baldwin Park - City Clerk E. Pacific Ave. Baldwin Park, CA Beaumont - City Attorney 550 E. 6th Street Beaumont, CA Bell - City Clerk 6330 Pine Avenue Bell, CA Bellflower - City Attorney Civic Center Drive Bellflower, CA Beverly Hills - City Clerk 455 N Rexford Drive Beverly Hills, CA Blythe - City Attorney 235 N Broadway Blythe, CA C-1 08/2018

36 Blythe - City Clerk 235 N Broadway Blythe, CA Bradbury - City Attorney 600 Winston Avenue Bradbury, CA Bradbury - City Clerk 600 Winston Avenue Bradbury, CA Brea - City Attorney 1 Civic Center Circle Brea, CA Brea - City Clerk 1 Civic Center Circle Brea, CA Buena Park - City Attorney 6650 Beach Blvd Buena Park, CA Buena Park - City Clerk 6650 Beach Blvd Buena Park, CA Calabasas - City Attorney 100 Civic Center Way Calabasas, CA Calabasas - City Clerk 100 Civic Center Way Calabasas, CA California City - City Attorney Hacienda Blvd. California City, CA California City - City Clerk Hacienda Blvd. California City, CA Calimesa - City Attorney 908 Park Ave. Calimesa, CA Calimesa - City Clerk 908 Park Ave. Calimesa, CA Camarillo - City Attorney 604 Carmen Drive Camarillo, CA Camarillo - City Clerk 604 Carmen Drive Camarillo, CA Canyon Lake - City Attorney Railroad Canyon Road Canyon Lake, Canyon Lake - City Clerk Railroad Canyon Road Canyon Lake, Carpinteria - City Attorney 5775 Carpinteria Avenue Carpinteria, CA Carpinteria - City Clerk 5775 Carpinteria Avenue Carpinteria, CA Cathedral City - City Attorney Avenida Lalo Guerrero Cathedral City, CA Carson - City Attorney 701 E Carson Street PO Box 6234 Carson, CA Cathedral City - City Clerk Avenida Lalo Guerrero Cathedral City, CA Carson - City Clerk 701 E Carson Street PO Box 6234 Carson, CA Cerritos - City Attorney Bloomfield Avenue Cerritos, CA Cerritos - City Clerk Bloomfield Avenue Cerritos, CA Chino - City Attorney Central Ave. Chino, C A Chino - City Clerk Central Ave. Chino, C A Chino Hills - City Attorney City Center Dr. Chino Hills, CA Chino Hills - City Clerk City Center Dr. Chino Hills, CA Claremont - City Attorney 207 Harvard Avenue Claremont, CA Claremont - City Clerk 207 Harvard Avenue Claremont, CA Commerce - City Attorney 2535 Commerce Way Commerce, CA Commerce - City Clerk 2535 Commerce Way Commerce, CA Compton - City Attorney 205 S Willowbrook Avenue Compton, CA Compton - City Clerk 205 S Willowbrook Avenue Compton, CA Corona - City Attorney 400 S. Vicentia Avenue Corona, CA Corona - City Clerk 400 S. Vicentia Avenue Corona, CA Costa Mesa - City Attorney 77 Fair Drive Costa Mesa, CA Costa Mesa - City Clerk 77 Fair Drive Costa Mesa, CA C-2 08/2018

37 Covina - City Attorney 125 E. College St. Covina, Ca Covina - City Clerk 125 E. College St. Covina, Ca Cudahy - City Attorney 5220 Santa Ana Street Cudahy, CA Cudahy - City Clerk 5220 Santa Ana Street Cudahy, CA Culver City - City Attorney 9770 Culver Boulevard Culver City, CA Culver City - City Clerk 9770 Culver Boulevard Culver City, CA Cypress - City Attorney 5275 Orange Avenue Cypress, CA Cypress - City Clerk 5275 Orange Avenue Cypress, CA Delano - City Attorney P.O. Box 3010 Delano, CA Delano - City Clerk P.O. Box 3010 Delano, CA Desert Hot Springs - City Attorney Pierson Blvd. Desert Hot Springs, CA Desert Hot Springs - City Clerk Pierson Blvd. Desert Hot Springs, CA Diamond Bar - City Attorney Copley Drive Diamond Bar, CA Diamond Bar - City Clerk Copley Drive Diamond Bar, CA Downey - City Attorney Brookshire Avenue Downey, CA Downey - City Clerk Brookshire Avenue Downey, CA Duarte - City Attorney 1600 Huntington Drive Duarte, CA Duarte - City Clerk 1600 Huntington Drive Duarte, CA Eastvale - City Attorney Limonite Ave. Ste. 910 Eastvale, CA Eastvale - City Clerk Limonite Ave. Ste. 910 Eastvale, CA El Monte - City Attorney Valley Blvd. El Monte, CA El Monte - City Clerk Valley Blvd. El Monte, CA El Segundo - City Attorney 350 Main Street El Segundo, CA El Segundo - City Clerk 350 Main Street El Segundo, CA Exeter - City Attorney 137 North F Street Exeter, CA Exeter - City Clerk 137 North F Street Exeter, CA Farmersville - City Attorney 909 West Visalia Rd. Farmersville, CA Farmersville - City Clerk 909 West Visalia Rd. Farmersville, CA Fillmore - City Attorney 250 Central Avenue Fillmore, CA Fillmore - City Clerk 250 Central Avenue Fillmore, CA Fontana - City Attorney 8353 Sierra Avenue Fontana, CA Fontana - City Clerk 8353 Sierra Avenue Fontana, CA Fountain Valley - City Attorney Slater Avenue Fountain Valley, CA Fountain Valley - City Clerk Slater Avenue Fountain Valley, CA Fullerton - City Attorney 303 W. Commonwealth Ave Fullerton, CA Fresno County - County Counsel Hall of Records, Room Tulare Street Fresno, CA Fullerton - City Clerk 303 W. Commonwealth Ave Fullerton, CA Fresno County - County Clerk Hall of Records, Room Tulare Street Fresno, CA Garden Grove - City Attorney Acacia Parkway Garden Grove, CA C-3 08/2018