The California Public Utilities Commission denied a request from San Diego Gas & Electric to bill ratepayers $379 million in damages related to the 2007 wildfires.
SDG&E settled 2,500 lawsuits from people with fire damage for about $2.4 billion, the majority of which was covered by SDG&E’s liability insurance and recoveries from third parties. The $379 million in uninsured costs remained.
All five CPUC commissioners voted against SDG&E, ruling that the utility did not reasonably manage its facilities linked to the wildfires, which all told destroyed more than 1,300 homes and killed two people.
SDG&E will “vigorously pursue all available avenues to overturn this decision,” said Lee Schavrien, the utility’s senior vice president and chief regulatory officer.
“This decision is not supported by the evidence and is not consistent with the determination made by the Federal Energy Regulatory Commission (FERC). FERC conducted its own inquiry and found SDG&E acted reasonably and approved the FERC-jurisdictional portion of the wildfire cost request. We find it difficult to understand how federal regulators understood the law and applied it appropriately, while the CPUC adopted a flawed interpretation,” Schavrien stated.
Sempra, which owns SDG&E, prepared for the possibility of the CPUC denying the request in quarter three results, released Oct. 30. Its unadjusted earnings put on the books a $208 million loss related to the wildfires.
If the proposal had been approved, SDG&E would have increased ratepayers’ bills by an average of $1.67 a month over six years.