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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported): September 23, 1996
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Exact name of
Commission Registrant IRS Employer
File as specified State of Identification
Number in its charter Incorporation Number
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1-11439 ENOVA CORPORATION California 33-0643023
1-3779 SAN DIEGO GAS &
ELECTRIC COMPANY California 95-1184800
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101 ASH STREET, SAN DIEGO, CALIFORNIA 92101
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(Address of principal executive offices) (Zip Code)
(619) 696-2000
Registrant's telephone number, including area code-----------------------
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(Former name or former address, if changed since last report.)
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FORM 8-K
Item 5. Other Events
On September 23, 1996 California's Governor Pete Wilson
signed into law a bill on restructuring the electric utility
industry. The legislation, which was unanimously passed by
the California Legislature on August 31, 1996, mirrors much
of the California Public Utilities Commission's
restructuring order by providing for recovery of stranded
investment and the establishment of a power exchange and
independent system operator, as well as aiding the
continuation of public-policy programs.
However, the bill contains a few key differences from the
CPUC decision. Recovery of stranded costs will be
accelerated to December 31, 2001 (instead of 2005). At the
start of the new competitive market (scheduled for January
1, 1998), SDG&E will receive approximately $500 million from
the proceeds of rate-reduction bonds issued by an agency of
the State of California. These bonds will be repaid over ten
years by SDG&E's residential and small commercial customers.
Receipt of these funds will enable SDG&E to effect a
decrease in rate base which, along with the retention of
certain overcollected balancing accounts (which otherwise
would have been refunded via future rates), will result in a
reduction of residential and small commercial customers'
rates by ten percent beginning in January 1998. These rates
will remain at that level until approximately March 31,
2002. Until the earlier of that date or until transition
cost recovery is complete, rates for industrial,
agricultural and large commercial customers will be frozen
at June 10, 1996 levels. If fuel costs change significantly,
rates can be increased or decreased to compensate therefor,
but cannot be increased above 9.985 cents per kwh. With
certain exceptions, stranded costs not recovered by December
31, 2001 will not be collected from customers. Such costs,
if any, would be written off as a charge against earnings.
The actual workings of the new law on restructuring the
electric utility industry are subject to various risks and
uncertainties. Although Enova Corporation and SDG&E believe
that their expectations are based on reasonable assumptions,
they can give no assurance that those expectations will be
realized. Important factors that could cause actual results
to differ materially from those discussed herein include the
existence of or ability to create a market for the bonds,
further political developments at both the state and federal
levels, and the ability to effect a coordinated and orderly
implementation of both this legislation and the CPUC's
restructuring regulations.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrants have duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
ENOVA CORPORATION
and
SAN DIEGO GAS & ELECTRIC COMPANY
(Registrants)
Date: September 24, 1996 By: /s/F.H. Ault
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F.H. Ault
Vice President and Controller
