Proposed CRS Exemption Process Flow

1. Proposed CRS Exemption Process Flow SCE - Proposed Process

2. Categorization Criteria SCE - Proposed Process

3. Customer Generation Categories in D.03-04-030 1 See Departing Load Charges matrix SCE - Proposed Process

4. SCE’s Estimate of Current and Potential Departing Load Charges (¢/kWh)– Pending Approval of SCE’s Advice Letter Filing (1700-E) 1 Includes CG eligible for net metering, including AB 2228 Biogas Digester CG, and CG that meets the Public Utilities Code (PUC) § 353.2 requirements for ultra-clean and low-emission (defined in footnote no. 2) and is eligible to participate in the CPUC Self Generation Program or California Energy Commission (CEC) program. 2 Ultra-clean and low-emission CG, as defined in PUC § 353.2, is any electric generation technology that meets the following criteria: 1) commences initial operation between Jan. 1, 2003, and Dec. 31, 2005, and 2) produces zero emissions during its operation or produces emissions during its operation that are equal to or less than the 2007 State Air Resources Board emission limits for distributed generation, except that technologies operating by combustion must operate in a combined heat and power application with a 60% system efficiency on a higher heating value. 3 The DWR Bond Charge is based on the decision adopted by the CPUC on Dec. 30, 2002, D.02-12-082, and will remain in affect for approximately 20 years. SCE proposes that this charge be reduced to 0.444 ¢/kWh (Advice Letter 1707-E) when Post-PROACT rates are implemented (estimated Aug. 1, 2003). DL via CG on or before Jan. 17, 2001, is exempt from this charge. 4 A charge for DWR Forward Costs related to ongoing DWR power purchase contracts will apply only if the cumulative MW cap amount of CG is exceeded, initially set at 3,000 MW statewide (within this cap, phased 1,500 MW cap for CG not meeting the requirements for “ultra-clean and low-emission” distributed generation and eligible for CPUC/CEC financial incentives and phased 165 MW for the UC/CSU system). DL via CG on or before Jan. 1, 2003, or for which (a) an application for authority to construct was submitted to the lead agency under CEQA, not later than Aug. 29, 2001, and (b) commercial operation commences not later than Jan. 1, 2004, is exempt from this charge. 5 The HPC responsibility for DL that was receiving bundled service at the time of the departure be computed on a customer-specific basis based on the net undercollection related to each service account. 6 The eligible costs will be limited to those cost categories defined in PUC § 367(a)(1)-(6) to the extent that they are not otherwise exempted by PUC § 372 and/or 374. This estimate uses SCE’s CTC calculation, which is based on the total portfolio methodology, against the 4.3 ¢/kWh benchmark adopted in D.02-11-022, QF costs based on 2002 forecast, and all other generation costs kept constant based on adopted 2002 revenue requirements. These charges will decline over time. Contact your SCE Account Representative for more information. 7 These charges are based on the current rates and are subject to change. In addition, Fixed Transition Amount Charges may also be applicable to some residential and small commercial customers. SCE - Proposed Process