A proposed new law to implement sections of the governor’s agreement (MOU) with Southern California Edison Co. will be offered later this week in the ongoing special session of the state legislature, Edison senior vice president Bob Foster said Tuesday in a regular conference call with utility bondholders. Foster characterized the state lawmakers’ attitude as “cautious,” but noted there is “no outright rejection” of the Edison MOU, which requires a state law to authorize California to buy the utility’s transmission assets and assign a portion of its rates to pay for state-backed bonds.

In separate action, Edison said it has paid about $250 million in going-forward bills since March 27 to small, “qualifying facility” (QF) generators, and it has a court hearing today to consolidate 15 separate lawsuits by the QFs against the utility.

While Foster was careful to note that the MOU is not being offered as a “take-it-or-leave-it” deal to the legislature, he also said it is a “balanced agreement,” meaning if any one element is taken out, it has to be replaced with something else. In that regard, Foster said he hoped the lawmakers, as they become more familiar with the agreement, would be reluctant “to unravel” the deal because it would be “dangerous” and time consuming to do so at this point.

Foster acknowledged that there was “a lot of negative reaction and that was expected” last week when the state legislature resumed after its Easter recess and a week after Gov. Gray Davis and Edison announced the MOU. A proposed bill will begin the process of legislative hearings under the still-effective emergency special session, “meaning the proposal could move quickly if we can get some agreement,” Foster said.

On the regulatory front, another Edison utility executive said the company filed an advice letter with the California Public Utilities Commission last Friday to establish the ratemaking processes going forward for the utility-retained generation that includes in-state hydroelectric and nuclear plants and out-of-state coal and nuclear generation in Nevada, Arizona and New Mexico.

In addition, the utility is in the process of withdrawing pending applications with the CPUC to sell its interest in the Mohave (NV), Palo Verde (AZ) and Four Corners (NM) power plants, in addition to its request for a formal valuation of its hydro facilities in preparation for their potential transfer or sale. All of those deals are prohibited under terms of the MOU and an earlier state law.

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