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State Regulators To Consider SDG&E’s ‘07 Wildfire Cost Reimbursement Thursday

Three firefighters brace themselves from explosive heat coming from a burning...

Photo by Lenny Ignelzi / Associated Press

Above: Three firefighters brace themselves from explosive heat coming from a burning home in the Rancho Bernardo area of San Diego, set off by a wildfire seen here in a file photo taken Monday, Oct. 22, 2007.

The question of whether San Diego Gas & Electric’s shareholders or customers should pay $379 million in costs related to the 2007 wildfires goes before state regulators Thursday. KPBS Evening Edition anchor Ebone Monet spoke to KPBS Investigative Reporter Amita Sharma about SDG&E's request.

Q: Amita, SDG&E’s request to the California Public Utilities Commission to let it bill ratepayers for some of the ‘07 fire costs really steams a lot of people. Why?

A: Well, I’ve spoken to many ratepayers about this issue over the years. And I think it comes down to accountability, to responsibility, to fairness. After the 2007 fires, the state opened an investigation. That inquiry concluded that it was SDG&E's lines that ignited the firestorms. Investigators didn’t stop there. And this is key. The investigators said those fires started because SDG&E did not properly design, build and maintain its equipment.

So for those who remember that fact, it’s galling for the company to then come back and try to charge ratepayers for those fires, fires that killed two people, destroyed 1,300 homes and caused $2 billion in damage to the region.

Q: Now, SDG&E has asked state regulators twice before to allow the company to charge customers for the ‘07 fire costs. Twice they were refused. This year, SDG&E asked again. A trial was held and what happened?

A: Evidence was presented. And two administrative law judges, S. Pat Tsen and Sasha Goldberg, decided that SDG&E should not be allowed to recover those '07 wildfire costs because, again this is key and these are the judges words, “SDG&E did not reasonably manage and operate its facilities prior to the 2007 wildfires.”’

I spoke with ratepayer Ruth Hendricks who owns a restaurant called The Huddle in San Diego. Here’s what she thinks about SDG&E requesting ‘07 fire reimbursement again.

“It’s very unfair. We’ve already solved this problem. And I don’t think it’s fair that they come back to the ratepayers to pay for their expenses.”

Q: So the judges issue this decision. It’s up to the five commissioners on the California Public Utilities Commission to accept or reject it. That is supposed to happen Thursday. But SDG&E has been lobbying the commission since the judges’ decision. Tell me about that.

A: Since the judges’ decision SDG&E representatives have met privately with the staff of each and every one of those commissioners.

The company has argued to those commissioners that the judges’ decision was full of factual and legal errors.

I spoke with San Diego consumer lawyer Mike Aguirre who has challenged SDG&E’s request to get the fire cost reimbursement. He believes those closed-door meetings between SDG&E executives and commissioners’ staffers may be turning the tide against ratepayers. Here's what he said.

“So imagine if you’re sitting there and you’re a party to a jury trial and the jury comes back and the judge reads the verdict and the other side says, `Oh no, don’t read the verdict yet. Let’s go back and talk to you and let us go back and talk to the jury. Let us bring some more people in that will be able to make up arguments for us.' It’s a complete travesty."

Q: Amita, if the PUC gives SDG&E the green light to bill customers for these costs, how much does it amount to?

A: $1.67 a month when amortized over six years. I asked Ruth Hendricks, again owner of the The Huddle, how she viewed that increase. Here's what she said.

“They’re saying a $1.67 a month. I think they’ll probably find ways to increase that $1.67 a month. I am a small business owner. We live here hand to mouth. We’re a mom and pop operation. I also founded and run a nonprofit and how it’s going to affect us is I think more than a $1.60 a month.”

Q: What does SDG&E say about this?

A: An SDG&E spokeswoman says the company has tracked the '07 wildfire costs. It has settled 2,500 lawsuits stemming from the '07 wildfires for $2.4 billion. The $379 million figure that SDG&E wants customers to cover is what is said to be the balance after deductions for insurance reimbursement.

The company's request to be allowed to bill customers $379 million for costs related to the 2007 wildfires has angered some ratepayers.

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