San Diego Business Journal

SDG&E Makes Its Case for Ratepayers to Pick Up $379M of Wildfire Costs

By John Cox Sunday, January 8, 2017
   

Just before two public hearings on the matter, San Diego Gas & Electric Co. made its case to local news media Jan. 6 why it wants ratepayers to pay 90 percent of the remaining $421 million in unrecovered costs from three devastating 2007 wildfires CalFire officials have blamed on the utility’s power lines.

Company officials asserted SDG&E properly engineered, maintained and inspected its infrastructure in advance of the Witch, Guejito and Rice fires, but that the Santa Ana winds that stoked the blazes were “unprecedented” and therefore the utility cannot reasonably be expected to have prepared for them.

“If we could’ve avoided these fires, of course we would have. We just didn’t have the information,” SDG&E attorney Christopher Lyon said in one of a series of one-on-one interviews with news reporters.

Since the fires, the company says it has made a “significant investment” in not only monitoring and reporting weather conditions that can give rise to wildfires, but also improving its coordination with fire agencies. SDG&E representatives declined to disclose the size of its various fire-related investments, which customers are paying for in the form of higher rates.

Property owners who suffered damage from the fires brought more than 2,000 lawsuits against SDG&E. The company settled these claims for a total of $2.4 billion.

While SDG&E’s insurance covered some of the costs, $421 million remains to be recovered. Investors will kick in 10 percent, which company representatives said management proposed based on a decision by the utility’s primary regulator, the California Public Utilities Commission, in a hazardous waste case from the 1990s.

The remaining $379 million would be paid by SDG&E customers. If the CPUC agrees, the average residential ratepayer will pay $1.70 per month for six years to help the company recover its costs relating to the three fires.

CPUC hearings on SDG&E’s request have been set for 2 and 7 p.m. Jan. 9 at the California Center for the Arts, Escondido.