The panel recently agreed to rehear arguments relating to $98.6 million of its earlier disallowance on San Onofre.
Whether by negotiated settlement or as the result of full hearings and conventional rate determination, the eventual impact on PG&E is expected to be far smaller than the proposed disallowance.
It would "send a favorable signal to investors," said Robin Jaffe, an analyst with Dean Witter Reynolds, noting that some are wondering just how much more of a disallowance might be in store for Unit 2.
The proposed $29 million disallowance represents about 5% of the total cost of the utility's power purchases during the period.
"We expect the rate treatment in one form or another to be equal a disallowance of about $1.5 billion," said John B. Kellenyi, an analyst at Drexel Burnham Lambert Inc.
The oil companies paid an extra $88.5 million in taxes to New Jersey from 1980 through 1984 because of the state tax disallowance.
The Houston-based utility said the charge is related to the disallowance of $375.5 million of its Houston Lighting & Power Co. unit's $2.8 billion investment in the South Texas Project.
That includes a refund of temporary rate boosts and a disallowance of tax deductions on the write-off.
Niagara Mohawk said its share of this disallowance will total $66 million, but it added that its books already reflect the writedown.
The Public Staff Division's recommended disallowance was disclosed yesterday after the stock markets closed.
A state appeals court had previously backed the city council's disallowance of the $135 million plant costs.