OFFICE OF RATEPAYER ADVOCATES RECOMMENDS CPUC DENY SDG&E APPLICATION FOR REHEARING ON WILDFIRE COSTS

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By Miriam Raftery

January 28, 2018 (San Diego) – The Office of Ratepayer Advocates (ORA) has issued a recommendation urging the California Public Utilities Commission (CPUC) to deny a request by three utility companies for a rehearing, after the CPUC ruled that San Diego Gas & Electric Company (SDG&E) cannot charge ratepayers for its uninsured losses from the 2007 Witch, Guejito and Rice wildfires.

The ORA recommendation states, “the arguments raised in the rehearing applications are without merit. Indeed, many of the arguments raised have already been considered and rejected by the Commission. Since, SDG&E, PG&E and SCE (jointly, the “utilities”) have failed to demonstrate legal error, there is no basis for granting rehearing.”

PG&E (Pacific Gas & Electric) and SCE (Southern California Edison) joined the action out of concern it could set a precedent that could prevent them from charging ratepayers for losses from utility-caused fires elsewhere in California.

SDG&E, along with PG&E and SCE, are seeking a rehearing based on the following arguments:

1. Under the theory of inverse condemnation, the Commission was required to allow SDG&E to spread its costs associated with the Witch, Guejito and Rice fires among its ratepayers. The Commission’s failure to consider inverse condemnation in this proceeding is contrary to federal and state statutes and the denial of SDG&E’s application constitutes a taking;

2. The Decision is not supported by substantial evidence in light of the record and fails to properly apply the prudent manager standard;

3. By failing to recirculate the revised proposed decision for comment, the Commission violated Public Utilities Code

§ 311(g) and denied SDG&E its due process rights;

4. The Commission’s application of the prudent manager standard is not supported by the Mojave, Helms and SONGS I decisions; and

5. The Decision’s findings regarding the weather conditions in

October 2007 are not supported by the record.

Comments

Wildfire Cost Recovery & Inverse Condemnation

SDG&E seeks to recoup costs paid out pursuant to inverse condemnation to settle wildfire damage claims, however the court never rendered a judgmemt against SDG&E under inverse and SDG&E did not pay damages due under inverse to the fire victims. Signifigant settlememt dollars were paid to lawyers and the insurance companies, not the fire victims.

Charging customers for damages

Just think for a moment - what if this outrageous practice were allowed for SDG&E? Now extrapolate this to any and all businesses, everywhere. This could potentially mean that, let's say your favorite grocery store has a damaging event of some type, then they could (by Sempra energy's logic) add a surcharge onto your grocery bill. Would that be okay? I equate this as a price gouging technique, similar to a restaurant adding a tip into your bill without consent.