CPUC HOLDS MEETING IN CHULA VISTA, PUTS OFF DECISION OF SDG&E CHARGING RATEPAYERS FOR 2007 SAN DIEGO COUNTY WILDFIRE LOSSES

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By Paul Kruze

October 7, 2017 (San Diego’s East County) -- Residents from San Diego's East County testified during the open comment period at last Thursday’s California Public Utility Commission (CPUC) meeting in Chula Vista.

Earlier in the day, the CPUC held a hearing on whether or not to approve a recommendation made by two CPUC administrative law judges to reject SDG&E’s application seeking to charge ratepayers for its uninsured losses in three of the 2007 wildfires. That hearing consisted largely of technical arguments. Afterward, a second meeting in Chula Vista was held for all parties involved, and public testimony was also taken. 

During public testimony at the second meeting, 29 residents spoke, including 10 who addressed the commission about the SDG&E controversy – three-quarters of whom criticized the investor-owned electric utility.

The Witch Creek fire started when power lines whipped by hurricane-like Santa Ana winds started a small fire east of Ramona. The fire spread to the San Diego city limits and merged with the Guejito Fire which started in the San Pasqual Valley. The Harris fire started the same day in Potrero. The fires triggered the largest evacuation in San Diego County which ended up forcing more than 500,000 people from their homes. SDG&E has claimed that multiple communications lines on poles which it shares with cable TV operator Cox Communications, were lashed together with metal wire. It says that that metal wire had become loosened and arched when it touched SDG&E’s wires below it.

SDG&E has maintained that it was not responsible for the fires and wants recoup its uninsured losses by charging ratepayers $379 million dollars, rather than dipping into its profits.

The 2007 wildfires, which devastated parts of East County and resulted in the deaths of 10 people, 288,430 acres burned, and 1,650 buildings destroyed.  Of these, Cal Fire found SDG&E responsible for the Witch, Rice and Guejito Fires (Cox Cable also shared responsibility for one fire.) After a decade, many residents have yet to be compensated for their losses caused by the fire.

The original agenda of the CPUC was set for the directors to either approve or disapprove the administrative law judges’ earlier recommendation that SDG&E must pay claims against it from its own coffers instead of charging ratepayers. However, at the last minute the agenda item that would have decided the petition was held over until the CPUC’s next meeting on October 12th in San Francisco. That action came after SDG&E engaged in ex-pate communications to lobby CPUC commissioners staff, a disclosure document filed with the CPUC indicates.

SDG&E has argued that the California Constitution guarantees that requires payment of just compensation be made when property has been taken or damaged for the public use. It says that it is an important element to be considered if it is able to recover the $379 million in expenses it says it sustained because of the fire, which it says, was caused by circumstances beyond its control. It further says that courts have ruled in the past in California that utilities can spread their costs which they have incurred to ratepayers. That would mean that ratepayers would be charged $1.67 more per month over six years.  

Photo, right:  Lee Schavrien, SDG&E Chief Regulatory Officer

Lee Schavrien, SDG&E's Chief of Regulatory Affairs, cited an independent report issued by the Federal Energy Resource Commission which called the utility as a “prudent operator.” It said the settlements that SDG&E has reached totalling some $2 million dollars and other costs “were reasonable as the result of the application of inverse condemnation and the State of California, in particular, of the Supreme Court, in this specific case.” He also cited the extreme “hurricane” like winds which caused many families to evacuate from the area including his.

“Inverse condemnation” is a legal term describe a situation in which the government takes private property but fails to pay the compensation required by the 5th Amendment of the Constitution, so the property's owner has to sue to obtain the required just compensation. It is the opposite of “eminent domain.”

The cadre of East County residents who came to the meeting couldn’t have disagreed more with SDG&E’s claims that it needs protection.

A ratepayer from Borrego Springs, Maris Brancheau, expressed her disappointment to the five commissioners who sat at the dais, usually reserved for members of the Chula Vista City Council. “The community is very disappointed that this agenda item had been held--that we can’t see you with our own eyes vote on this,” Brancheau continued to say. “We ask you – do not turn your backs on us by going back to San Francisco and proving for the investor-owned utility what we consider a large windfall.”

Photo, left:  Ramona Resident Diane Conklin

Ramona Resident Diane Conklin representing the “Mussey Grade Road Alliance” said that the proposed decision offered by two CPUC Administrative Judge's decision that SDG&E did not meet the “prudent manager” standard for the Witch Fire, and should be adopted. Reading from a pre-prepared statement, Conklin said, “SDG&E did meteorological studies showing that winds of up to 120 miles per hour could be expected in its service area, yet they continued to build, maintain and operate its equipment for a 56 miles per hour wind loading,” Conklin said. She also stated that SDG&E sponsored an academic study that showed that “line slap” as what SDG&E alleges to have happened when the loosened wire lashing on the Cox Communications wire bunch could cause wildfires, but did nothing with that knowledge.

Sally Crosno, a victim of the Witch Fire who attended the meeting said to NBC San Diego, “If there's no fault, ever, then they'll never be held accountable for having started the fires, and that's what we're pushing for,” she said. Although the investor-owned utility has paid more than $2 million in settlements and other costs, it has not admitted any liability in the wildfires.

Photo, right:  Michael Aguire Led Out by CHP Officer

Former San Diego City Attorney Mike Aguirre, who has for many years actively fought against SDG&E became involved with a verbal firefight with CPUC chair Michael Picker, early on during the public testimony portion of the meeting. The altercation came after Joe Craver, retired CEO of the American Red Cross San Diego-Imperial Counties said the weather – a witch’s brew of high temperatures and extremely high winds -- during the 2007 wildfire event had never been seen before.

Aguirre began his rant by admonishing the two newest members of the CPUC, “Disassociate yourself from Mr. Picker.” Turning to Picker, Aguirre said, “You're a hypocrite, you just allowed that,” he said, referring to Craver testifying. “He's a former executive of SDG&E. Is that what you're going to do? Mr. Picker, the country – the state of California is concerned about you. It is clear that you don't have the leadership capacity to head the CPUC. When you were with the Governor's office-- did you involve yourself in the secret negotiations in the San Onofre case? You were on the staff – we know because of e-mails about it – did you know there was a secret meeting in Warsaw, Poland,” he said, referencing reports of secret ex-parte-meetings discovered after state investigators in a criminal probe of Picker’s house found meeting notes on stationary from a Warsaw hotel.  .  Would you answer that question that resulted in rate payers in Chula Vista and San Diego having to pay billions of dollars?”

Photo, left:  Michael Picker, President, CPUC

Picker replied, “Now you are speaking to a proceeding you are a party to.”

Aguirre retorted, “It is not on the agenda. Mr. Picker, it is not on the agenda. Two rules – Ex parte – it's not on the agenda. Mr. Picker, quit dodging. Did you or did you not know about the secret meeting?” he demanded.

A General Counsel for commissioners then joined the melee when she interrupted Aguirre, arguing whether his comment was ex parte or not on the agenda.

“I'm not a party...I'm a lawyer and former City Attorney of San Diego. I'm a resident of this community.” He then accused the General Counsel of being untruthful. “That's a false statement,” Aguirre replied, at which time he turned once again to Picker and said, “You are a complete fraud,” at which point a California Highway Patrol officer acting as the meeting's sergeant-at-arms approached Aguirre at the podium and escorted him out of the room.

The meeting proceeded throughout the morning without any further interruptions.

VIEW VIDEO CLIPS:

Open Testimony
https://youtu.be/RcMZ-3P9eD4

WEMA All-Party Meeting

https://www.youtube.com/watch?v=aiVFSznIrhs&t=142s

Michael Aguirre confronts CPUC (starting midway through this short clip)
https://youtu.be/9OKCPn5ldAM