CPUC Denies SDG&E Rate Hike to Cover Fire Settlement

After initially denying a request to pass along the settlement cost to ratepayers, the CPUC commissioner revised his decision

The California Public Utilities Commission was poised to approve a new electricity rate hike that will effectively shift the responsibility of a multi-million dollar settlement from San Diego Gas and Electric shareholders to ratepayers according to a San Diego consumer group.

San Diego's Utility Consumer's Action Network (UCAN) appealed to delay the CPUC’s vote, calling the last-minute recommendation by Commissioner Timonthy Alan Simon “unfair” and a “bait-and-switch.”

“If this decision is adopted your rates go up to pay for the fires caused by SDG&E equipment,” said Donald Kelley, Executive Director of (UCAN).

Then, under pressure from UCAN and several local lawmakers, the commission withdrew the agenda item Thursday afternoon.

The action denied the request by SDG&E to retroactively impose a rate hike of nearly half a billion dollars to cover the cost of power-line caused fires in 2007, plus the cost of future damages.

In response, SDG&E released this statement:

"We believe the Commission today reached a reasonable compromise that gives SDG&E the opportunity to continue to make its case for rate recovery, while also allowing a robust reasonableness review by commissioners in the best interest of its customers."

Click here to read SDG&E's full response. 

SDG&E owes $463 million to firestorm victims after an independent report by Cal-Fire determined its power lines caused the Witch, Rice, and Guejito fires. Two people died and 1,300 homes burned down. Losses have run upwards of $2 billion.

SDG&E had asked that ratepayers cover 95-percent of the losses with Sempra investors on the hook for the rest. The company said this would cost the average customer around $190, payable at the rate of $3 to $4 per month for up to four years.

After initially denying the request to pass along the cost to ratepayers, Commissioner Simon revised his decision just hours before a hearing set to approve the final details of the long-awaited settlement UCAN told NBC 7 San Diego.

“Commissioner Simon found that despite three years of testimony experts and arguments by lawyers and all parties involved that he was persuaded at the very last second because SDG&E came up with a persuasive argument that caused him to do a 180 on his opinion,” said Kelly.

Instead of shareholders paying for the damages, Kelly said the ratepayers of San Diego County will be on the hook for that money.

The commission usually gives parties 20 days to consider revisions and submit comments.

UCAN requested a delay so they can publicize the new decision and ask ratepayers to call their elected officials to ask them to support the delay. Among the lawmaker are Assem.
Ben Hueso, Assem. Toni Atkins, Assem. Shirley Weber and Sen. Marty Block.

Even if the CPUC approves Simon’s recommendation, UCAN said the decision may be appealed through a lawsuit.

Contact Us