Common use of FORECASTED ANNUAL SALES PER CUSTOMER Clause in Contracts

FORECASTED ANNUAL SALES PER CUSTOMER. ISSUES: San Xxxxxxx used the New Committee Method (with modifications, especially to reflect effects of conservation programs) to forecast 2012 consumption for all customer classes, except for two large industrial customers, California Steel Industries, Inc. (“CSI”) and Cemex USA Construction Materials, Inc. San Xxxxxxx developed a company-specific estimate to forecast CSI’s 2012 consumption, using a three-year average that reflects CSI’s intended reliance on its own xxxxx to meet its water supply needs. For calendar years 2013 and 2014, San Gabriel applied downward adjustments to the 2012 consumption forecast to reflect ongoing and increasing conservation programming and the implementation of tiered rates for residential customers. DRA concurred in San Gabriel’s forecast of average customer sales for all customer classes and the resulting sales forecast for each customer class for calendar year 2012, but disagreed with San Gabriel’s annual conservation adjustment for each customer class. The City recommended that the forecast of annual sales to CSI be based on a five-year average in order to account for the possibility that CSI, in order to supplement its water needs, may require deliveries that exceed San Gabriel’s original estimate. RESOLUTION: San Xxxxxxx and DRA do not agree on the adjustment method, however, in the context of ongoing implementation of conservation efforts, they agree that the sales per customer numbers reflected below is a reasonable forecast of sales per customer. In order to resolve the issue presented by the City, San Xxxxxxx has agreed to a forecast of annual sales to California Steel Industries of 78,494 Ccf for each of the three years, which DRA accepts. The resultant annual sales forecasts in Ccf/customer, by class, for the Test Year and two Escalation Years, are as follows, except that Escalation Year sales may be revised in accordance with the Recycled Water Service Contract, which is now pending approval in A.00-00-000: Customer Class Settlement Annual Ccf/Customer Residential – Single Family 232.89 Residential – Multi-Family, Small 618 Residential – Multi-Family, Large 8,209 Commercial, Small 492 Commercial, Large 4,132 Industrial, Small 681 Industrial, Large 8,745 California Steel Industries 78,494 Cemex USA – contract 115,450 Cemex USA – tariff 49,478 Public Authority, Small 915 Public Authority - Large 5,856 Construction, Small 459 Construction, Large 1,991 Recycled Water Service 0 REFERENCES: Exhibit SG-1, Chapter 4; Exhibit SG-6 (XxXxxxxxx), pp. 2-14; Exhibit SG-14 (XxXxxxxxx); Exhibit DRA-1 (Xxxxxx), p. 2-3 to 2-10; Exhibit SG-19-C (XxXxxxxxx), pp. 2-4; Exhibit CF-1 (Xxxxx), pp. 12-17.