SAN DIEGO, Sept. 25, 2015 /PRNewswire/ -- San Diego Gas
& Electric (SDG&E) today asked the California Public
Utilities Commission (CPUC) for approval to recover in rates the
remaining costs to settle the 2,500 lawsuits related to the 2007
wildfires. SDG&E initially faced $4
billion in claims arising from the fires, but the company
made a decision to settle as many cases as possible to reduce the
overall customer cost impact. Settlement costs amounted to
$2.4 billion, the majority of which
was covered by SDG&E's liability insurance and recoveries from
third parties. SDG&E proposes its shareholders pay 10 percent
or $42 million. If approved, the
utility proposes to spread out the remaining $379 million over six years, which would result
in a monthly bill impact of less than $1.70 for a typical residential customer using
500 kilowatt-hours of electricity per month.
"We have gone to great lengths to minimize the impact to our
customers by successfully settling these lawsuits rather than
taking them to trial, which would have been significantly more
costly," said Lee Schavrien, chief
administrative officer for SDG&E. "We are in the final stages
of this proceeding, and after eight years, we believe that, as a
company, a community and a region, we are much better prepared for
a future fire emergency."
Since 2007, SDG&E has taken significant steps to enhance
operational and system safety and improve overall situational
awareness to reduce the potential for utility facilities to be an
ignition source. A key step was the installation of more than 170
weather stations throughout its service territory—the largest and
most concentrated weather network of any utility in the nation.
Every circuit that serves the high-risk "fire threat zone" in the
back country has at least one weather station that provides wind
speed, direction, temperature and humidity every 10
minutes—critical information needed to evaluate the possible impact
of weather on system operations. All of this data is available to
the National Weather Service, fire agencies and the general
public.
"With technology, we now have access to so much more information
than we had then about the truly unprecedented strength of the
Santa Ana winds in 2007, when we
had to rely on just a handful of weather stations," said
Steve Vanderburg, senior
meteorologist for SDG&E. "As part of the research to develop
the Santa Ana Wildfire Threat Index, we looked at the hourly
weather data over the past 30 years in Southern California and then overlaid the fire
weather history. What we found is that the winds in 2007, near
where the Witch fire started, were blowing at more than 90
miles-per-hour—that's almost as strong as a Category 2
hurricane."
In 2008, when deciding where to install the first of its new
weather monitors, SDG&E looked for areas with strong wind
activity. As a result, one was placed in west Santa Ysabel, which is one of the windiest
spots in the back country and close to the ignition site of the
Witch fire.
A final CPUC decision is expected in the first quarter of 2017.
Customers would not see any bill impact before then.
By law, SDG&E is required to serve all customers in its
service territory without exception, regardless of where they live
and California courts have found
that utilities like SDG&E are automatically responsible for
damage linked to their equipment, regardless of fault or
negligence, even where the utility equipment is only one of several
concurrent causes. Many factors outside of SDG&E's control—most
notably the Santa Ana winds—played
a major role in the ignition and spread of the 2007 wildfires.
Regulators historically have said that costs reasonably incurred
by a utility in fulfilling its obligation to serve all customers
can be recovered in rates.
SDG&E is a regulated public utility that provides safe and
reliable energy service to 3.4 million consumers through 1.4
million electric meters and 868,000 natural gas meters in
San Diego and southern
Orange counties. The utility's
area spans 4,100 square miles. SDG&E is committed to creating
ways to help customers save energy and money every day. SDG&E
is a subsidiary of Sempra Energy (NYSE: SRE), a Fortune 500 energy
services holding company based in San
Diego. Connect with SDG&E's Customer Contact Center at
800-411-7343, on Twitter (@SDGE) and Facebook.
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SOURCE San Diego Gas & Electric (SDG&E)