SDG&E ripped for plan to charge customers for 2007 firestorm settlements
SAN DIEGO — A county supervisor Thursday ripped San Diego Gas & Electric for the utility’s plans to factor some of the payments it made to settle lawsuits over the 2007 wildfires into the rates it charges customers.
SDG&E unveiled the proposal to collect $367 million from ratepayers earlier this week when parent-company Sempra Energy issued its quarterly earnings report. The figure is not final, and will be determined before the utility files a formal request with the California Public Utilities Commission this fall, according to spokeswoman Stephanie Donovan.
Supervisor Dianne Jacob, who has been critical of SDG&E policies the past few years, announced her opposition in a statement to the media.
“SDG&E’s on-going effort to stick ratepayers with the cost of wildfires it caused is outrageous,” said Jacob, who represents some of the areas ravaged by the fires nearly eight years ago.
“It’s especially offensive to those who lost their homes and even loved ones in the 2007 firestorms and are now being asked to help pay for the utility company’s mistakes,” Jacob said. “My hope is that state regulators stand up for San Diego County residents and reject SDG&E’s proposal.”
Several fires ravaged San Diego County in October 2007, two of which were touched-off by SDG&E equipment, and one of which SDG&E gear was partly responsible. According to Donovan, utilities are liable for damage caused by power lines, and the company has paid out well over $2 billion to conclude litigation.
The company had $1.1 billion in liability coverage, and recovered $824 million from third-party contractors and Cox Communications, according to its filing. That was still $494 million less than the cost of settling the 19,000 claims.
“The remaining costs of the settlements — that is, what is over and above what we’ve paid out from SDG&E’s liability insurance and recoveries from third parties — are costs of providing service, and as such, they’re costs SDG&E is allowed to recover in rates,” Donovan said.
“It’s understandable that those who suffered losses in the fires and their neighbors are angry and may not agree,” Donovan said. “We do hope they realize we have done everything possible not only to achieve reasonable settlements, but also to offset the amount of costs we would seek to recover through rates.”
She said the Santa Ana weather conditions in October 2007 were extreme and fueled the fires that destroyed more than 1,300 homes and killed two people. The extent of the damage was beyond what SDG&E could control, she said.