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Group Claims SDG&E Wants To Retroactively Charge Customers For 2007 Wildfire Liability

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If San Diego Gas & Electric gets its way, a consumer group claims customers could be paying several hundred dollars more a year for electricity. The Utility Consumers Action Network, or UCAN, claims SDG&E wants to retroactively impose a rate increase on customers to cover the cost of the 2007 wildfires, but the utility disagrees.

The Southern California wildfires in late October 2007 destroyed about 1,300 homes in San Diego County. It was fueled by strong Santa Ana winds, persistent drought and numerous other sources, including downed power lines.

State investigators determined San Diego Gas & Electric was responsible for several fires—including Witch Creek, the second largest fire in state history.

UCAN attorney David Peffer said customers may be on the hook to pay the $463 million liability cost.

(Story continues after the video.)

Stephanie Donovan, spokesperson for SDG&E, speaks with Joanne Faryon about the 2007 wildfires' impact on electricity prices.

"For the average rate payer it means higher bills, because the total cost of the wildfires have yet to be determined. And if there are future wildfires and this passes this could mean literally unlimited liability absorbed by rate payers," he said.

Peffer said based on the cost per meter, it works out to about $356 more a year for an average utility customer.

San Diego Gas & Electric responded in a statement Monday. It said UCAN doesn't have the facts straight. "SDG&E is not asking to recover 2007 fire costs in this proceeding. Rather, we're simply seeking the opportunity to treat 2007 wildfire costs like the costs from any future wildfires, and to have the ability to seek rate recovery of such costs through a future application."

Peffer said SDG&E is trying to appease its shareholders at the expense of its customers.

"The problem is from their cost benefit analysis it's too expensive to clear the brush and fortify the power lines, its not profitable. But it is possible. And their incentives would change if the shareholders had to bear the impact of this insurance cost," he said.

David Peffer of the Utility Consumers Action Network speaks with "Evening Edition" about his challenges to the SDG&E's proposed rate hikes.

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