colspan=2>
« back to results for ""
Below is a cache of http://www.pge.com/tariffs/advice/adviceletters/2482-G.pdf. It's a snapshot of the page taken as our search engine crawled the Web.
The web site itself may have changed. You can check the current page or check for previous versions at the Internet Archive. Yahoo! is not affiliated with the authors of this page or responsible for its content.
Pacific Gas and Electric Company (PG&E) hereby submits for filing the following changes to its tariff schedules REVISED




September 15, 2003


Advice 2482-G/2420-E
(Pacific Gas and Electric Company ID U 39 M)


Subject: PG&Es Authorization for Financial Hedging Memorandum Account

Pacific Gas and Electric Company (PG&E) hereby submits for filing the following
changes to its tariff schedules. The revised tariff sheets are attached hereto.
1


Purpose

This advice filing establishes the Financial Hedging Memorandum Account (FHMA),
which authorizes PG&E to record costs and benefits associated with interest rate
hedges approved by the Commissions General Counsel and Director of the Energy
Division, or their designated representatives. These incurred costs and benefits will
be recovered in PG&Es Cost of Capital proceeding or other proceedings where
PG&Es Cost of Capital is decided.

PG&E is authorized to enter into interest-rate hedges as described in Decision (D.)
03-09-020. In addition, PG&E shall comply with all record keeping and reporting
requirements pertaining to these financial instruments, which have been adopted in
D. 93-06-082.

Background

As stated in Decision 03-09-020, the Commission opened Order Instituting
Investigation (I.) 02-07-015, for the purpose of authorizing PG&E to issue preferred
stock and long-term debt instruments to finance only the Commissions proposed
Plan of Reorganization (POR). On November 7, 2002, the Commission granted
conditional authority for PG&E in D. 02-11-030, to issue up to $9.5 billion of
additional preferred stock and long-term debt, only to implement the Commissions

1
The Company reserves all legal rights to challenge the decisions or statutes under which it has been
required to make this advice filing, and nothing in this advice filing constitutes a waiver of such rights.
Also, the Company reserves any additional legal rights to challenge the requirement to make this
advice filing by reason of its status as a debtor under Chapter 11 of the Bankruptcy Code, and
nothing in this advice filing constitutes a waiver of such rights.


Advice 2482-G/2420--E
- 2 -
September 15, 2003

and the Official Committee of Unsecured Creditors First Amended POR proposed
by the Committee of Unsecured Creditors (Amended Plan) as amended, modified or
supplemented from time-to-time.

On July 25, 2003, PG&E filed a Petition for Modification of D. 02-11-030, to request
that the Commission modify the decision as soon as possible to authorize PG&E to
enter into forward rate agreements, options, and floors, as well as the previously
authorized swaps, caps, and collars (collectively, interest rate hedges) for debt
issued to implement ANY Bankruptcy Courts approved plan of reorganization,
immediately upon issuance by the Commission of its decision on the petition.

On September 4, 2003, the Commission adopted D.03-09-020, which authorized
PG&E to enter into interest rate hedges with concurrence of the Commissions
Financing Team. The Commission also authorized PG&E to establish a bankruptcy
financial hedging memorandum account to record the costs of any interest rate
hedges.

Memorandum Account

The FHMA, consistent with D. 03-09-020, will record all costs and benefits related to
approved interest rate hedges. This activity will result in costs and benefits such as,
but not limited to fees, broker charges, collateral payments, and cash payments or
receipts to PG&E under the interest-rate hedges.

PG&E believes the recorded costs and benefits and its inclusion in PG&Es Cost of
Capital Proceeding or other proceedings where PG&Es Cost of Capital is decided
are consistent with D. 03-09-020.

Protests

Anyone wishing to protest this filing may do so by sending a letter by October 6,
2003, which is 21 days from the date of this filing. The protest must state the
grounds upon which it is based, including such items as financial and service impact,
and should be submitted expeditiously. Protests should be mailed to:

IMC Branch Chief Energy Division
California Public Utilities Commission
505 Van Ness Avenue, 4
th
Floor
San Francisco, California 94102
Facsimile: (415) 703-2200
E-mail: jjr@cpuc.ca.gov

Protests also should be sent by e-mail and facsimile to Mr. Jerry Royer, Energy
Division, as shown above, and by U.S. mail to Mr. Royer at the above address.
Advice 2482-G/2420--E
- 3 -
September 15, 2003

The protest should be sent via both e-mail and facsimile to PG&E on the same date
it is mailed or delivered to the Commission at the address shown below.

Pacific Gas and Electric Company
Attention: Brian K. Cherry
Director, Regulatory Relations
77 Beale Street, Mail Code B10C
P.O. Box 770000
San Francisco, California 94177
Facsimile: (415) 973-7226
E-mail: RxDd@pge.com

Effective Date

PG&E requests that this filing be effective on September 15, 2003, which is the date
of filing. Given the intent of D. 03-09-020 and the urgency of implementing the
interest-rate hedging financial instruments, PG&E expects to commence these
activities as soon as possible.

Notice

In accordance with General Order 96-A, Section III, Paragraph G, a copy of this
advice letter is being sent electronically and via U.S. mail to parties shown on the
attached list and the service list for I. 02-07-015. Address changes should be
directed to Rose de la Torre at (415) 973-4716. Advice letter filings can also be
accessed electronically at:

http://www.pge.com/customer_services/business/tariffs/




Vice President - Regulatory Relations



Attachments


cc:
Service List I. 02-07-015

Original
Cal. P.U.C. Sheet No. 21818-G*
Pacific Gas and Electric Company
Cancelling

Cal. P.U.C. Sheet No.

San Francisco, California

PRELIMINARY STATEMENT
(Continued)
Advice Letter No. 2482-G/2420-E
Issued by
Date Filed
September 15, 2003
Decision No. 03-09-020
Karen A. Tomcala
Effective



Vice President
Resolution No.

49349
Regulatory Relations

BC. FINANCIAL HEDGING MEMORANDUM ACCOUNT (FHMA)
(N)
|
1.
PURPOSE: The purpose of the Financial Hedging Memorandum Account is to record the costs
and benefits related to financial interest rate hedges which are entered into by PG&E and
approved by the Commissions General Counsel and Director of the Energy Division, or their
designated representatives. These incurred costs and benefits will be recovered pursuant to
PG&Es Cost of Capital proceeding, as directed in Decision (D.) 02-11-027. PG&E is authorized to
enter into interest-rate hedges as described in Decision 03-09-020. PG&E shall comply with all
record keeping and reporting requirements pertaining to these financial instruments, which have
been adopted in Decision 93-06-082. The recorded costs and benefits shall include, but not be
limited to, fees, broker charges, collateral payments, and cash payments or receipts to PG&E
under the interest-rate hedges, and will be recovered as debt issuance costs as provided in
PG&Es Cost of Capital proceeding or other proceedings where PG&Es Cost of Capital is decided.
2.
APPLICABILITY: The FHMA shall apply to all customer classes, except for any classes that may
be specifically excluded by the CPUC.
3.
REVISION DATE: Disposition of the amounts in this account shall be recovered in PG&Es Cost of
Capital proceeding or other proceedings where PG&Es Cost of Capital is decided.
4.
FHMA RATES: This account does not have a separate rate component.
5.
ACCOUNTING PROCEDURE: PG&E shall maintain the FHMA by making entries at the end of
each month as follows:
a.
A debit or credit entry equal to the cash payments or receipts made under the interest rate
hedging contracts;
b.
A debit entry equal to the fees, broker charges, or other expenses incurred under the
interest-rate hedging contracts;
c.
A debit or credit entry equal to pre-payments and credit and collateral payments, including all
associated fees, for interest-rate hedging contracts, and if applicable, reimbursements of pre-
payments, credit and collateral payments; and
d.
An entry equal to the interest on the average balance at the beginning of the mo