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Supreme Court Denies SDG&E Appeal To Have Ratepayers Pay $379M For 2007 Wildfires

Flames from the Witch Creek fire light up the early Friday morning sky in nor...

Photo by Jon Vidar / Associated Press

Above: Flames from the Witch Creek fire light up the early Friday morning sky in northern San Diego County, Oct. 26, 2007.

San Diego Gas & Electric’s appeal to the nation’s highest court to have ratepayers pay $379 million in claims from the deadly 2007 wildfires was denied Monday.

SDG&E went to the U.S. Supreme Court last year after its argument had been repeatedly rejected by state courts and energy regulators since 2012. The utility argues that the deadly 2007 wildfires, which officials have connected to SDG&E, were out of its control, and it shouldn’t be on the hook to pay for it.

Listen to this story by Shalina Chatlani.

“SDG&E is disappointed in today’s US Supreme Court decision denying our petition regarding its Wildfire Expense Memorandum Application. SDG&E has shown that the fires occurred due to circumstances beyond our control, but nevertheless the application to spread the costs through rates was denied," SDG&E said in a statement Monday.

RELATED: SDG&E Asks US Supreme Court To Weigh In On Wildfire Costs

Reported by Shalina Chatlani , Video by Nicholas Mcvicker

"Despite this legal outcome, SDG&E remains committed to help strengthen wildfire preparedness and prevention and will continue our collaboration with other regional leaders to protect our customers and help prevent wildfires from devastating the communities we serve,” the statement said.

But, Maria Severson, the attorney representing ratepayers on this case, said the Supreme Court has sided with state regulators, who say the utility wasn’t acting responsibly.

"SDGE had a devastating fire, they had higher costs than just operations because they had to pay all these claims from the fire that it caused, but the Public Utility Commission found that no they did not meet the prudent manager standard. They weren’t clearing the brush. So who has to pay for that? The innocent customers? Or the shareholders?" Severson said.

RELATED: SDG&E Says There’s A 100% Chance It’ll Start Or Contribute To A Major Wildfire

"With the state of the law now, there’s a prudent management standard. The supreme court decided it wasn’t going to upset that," she said.

That’s a good thing, Severson said, because this standard holds utilities accountable for safety. But, she said state legislators went around that standard when they swiftly passed a $21 billion wildfire bill this summer.

The “bailout” as she called it, has ratepayers covering future wildfires and Pacific Gas & Electric’s bankruptcy from last year’s devastating Camp Fire, considered to be the worst fire in state history.

"That’s going to put customers on the hook. It’s going to move away from the prudent manager standard," Severson said.

She said SDG&E's appeal to the Supreme Court is the last appeal it can make to get ratepayers to pay the $379 million.

"What’s not done is the fight to overturn the wildfire bailout which is really a utility company bailout," Severson said.

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Aired: October 8, 2019 | Transcript

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