Thursday, May 24, 2012

Just Say No to Wildfire Recovery Rate Increases

The California Public Utilities Commission (CPUC) recently held hearings to evaluate a request by San Diego Gas & Electric (SDG&E) that could result in rate increases to recover costs from wildfires not covered by insurance.

SDG&E says it had $1.1 billion in insurance coverage in 2007 but has incurred $62 million in costs beyond that from 2007's San Diego County wildfires. As much as $400 million could be added to that from several hundred lawsuits still in process, the utility said.

The request before the California Public Utilities Commission is to establish a mechanism to increase rates to recover those kinds of costs. I recently testified before the Commission in opposition to this request.

SDG&E provides a high-demand service that must be provided at a regulated, reasonable cost. Few businesses in our region are faced with the public decisions that utilities must make. Public utilities must answer to ratepayers and stockholders in the face of government oversight and public scrutiny.

Yet without a doubt, the end result must be that the ratepayers come first. The CPUC is charged with protecting the public from decisions that are not in their best interests. And the request before the Commission does not serve the public interest. Ratepayers expect the clean and fast delivery of service that SDG&E provides. But they also have the right to expect that they will be treated fairly - not as a financial failsafe in the event of mistakes such as equipment failure or lack of brush clearing.    And like all businesses, utilities must be held accountable.  Otherwise, should we expect that we will be in another hearing in two years over similar issues?

No one expects any utility to be perfect. But we do expect them to own up, just like we would, when they make mistakes. We expect them to rebuild just as we would. And we expect them to do it by tightening their belts, making spending adjustments and attending to the bottom line.

SDG&E would be better served - and more admired - by taking their lumps and moving on without raising the rates of the hard working people of San Diego County.  Just say "no" to wildfire recovery rate increases.

Dave Roberts is the Deputy Mayor of the City of Solana Beach and is a candidate for Board of Supervisors in the Third District.

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