What is an Energy
Resource Recovery Account (ERRA) Proceeding?
Energy Resource Recovery Account (ERRA)
proceedings are used to determine fuel and purchased power costs which can be
recovered in rates. The utilities do not earn a rate of return on these costs,
and only recover actual costs. The costs are forecast for the year
ahead. If the actual costs are lower than forecast, then the utility
gives money back, and vice versa.
The ERRA regulatory process includes two proceedings:
annual ERRA Forecast proceeding to
adopt a forecast of the utility’s electric procurement cost revenue requirement
and electricity sales for the coming year.
annual ERRA Compliance proceeding
to review the utility’s compliance in the preceding year regarding energy
resource contract administration, least-cost dispatch, fuel procurement, and
the ERRA balancing account,
The Commission has also
established an ERRA “Trigger” mechanism which allows for the utility to file an
expedited application requesting an adjustment to rates, if the ERRA balance
reaches 4% in excess of prior year’s annual fuel and power purchase costs. On April 1st of every year the utilities
file a Trigger advice letter (AL) with the Commission specifying their coming
year trigger/threshold amount. Then the
IOUs file an application for expedited
Commission approval when the ERRA balance reaches the trigger/threshold amount previously
calculated in the Trigger AL.
The amount of money under review in ERRA proceedings is large. Typical amounts for PG&E and SCE are very roughly $4 billion, while for SDG&E they are roughly $1.3 billion.
The tables below provide links to current and historical ERRA proceedings categorized by proceeding type.
The Small Multi-Jurisdictional Utilities do not have ERRA proceeding. Instead they have Energy Cost Adjustment Clause (ECAC) or Power Purchase Adjustment Clause (PPAC) costs approval requests as a part of their rate case proceedings. For more information see decisions and applications on the following GRC webpages - Bear Valley Electric Servoces (a subsidiary of the Golden State Water Comapny), Liberty (CalPeco) and PacifiCorp.
*ERRA was established Pursuant to California Public
Utilities Code Section 454.5(d), Rules 2.1 and 3.2 of the Rules of Practice and
Procedure of the California Public Utilities Commission (“Commission”), and
Commission Decision (“D.”) 02-10-062.