Comments to the California Pubilc Utilities Commission Regarding SDG&E's proposed wildfire emergency balancing account

April 5, 2012 
San Diego

Thank you for coming to San Diego to hear firsthand from the people impacted by proposal.  I represent ratepayers in the eastern portion of San Diego County.  Like most of my constituents I am outraged that SDG&E would attempt to stick ratepayers with the bill for the 2007 wildfires… along with the tab for all future fires.

More than 200,000 acres burned in the Witch, Guejito and Rice fires. Some 1,800 homes and other buildings were destroyed. More than half a million people were evacuated from their homes. Catastrophic is an understatement. 

The flames from the 2007 might be out but many people in this room feel like we’re still getting burned. That’s because we’re watching our utility roll around in more than healthy profits while we’re being asked to pay for their mistakes.

As the Commission is well aware, SDG&E caused the 2007 wildfires. The Commission’s own Consumer Protection and Safety Division concluded that SDG&E failed to properly design, construct and maintain its lines.

-Guejito Fire:  A lashing wire contacted an SDG&E 12 kV conductor.  

- Witch Fire: SDG&E’s 69kV overhead conductors contacted each other in violation of general order 95, Rules 31.1 and 38 at the time of the fire.

- Rice Fire: A sycamore tree limb broke and fell onto SDG&E’s 12kV conductors in violation of GO 95, Rule 31.1 at the time of the fire.

These were rules that were in place at the time of the fires that SDG&E broke. SDG&E may try to say that the winds were an act of God. SDG&E safety violations were not at an act of God. There must be a penalty for skirting the rules. It’s very simple: you burn it, you buy it.

This notion that SDG&E cannot afford these costs or sufficient insurance is nonsense.

SDG&E managers and executives received more than $76 million in bonuses since 2007. That doesn’t include 2011. SDG&E’s parent company gave its top five executives $29 million in bonuses in year after the fires.

Two people were killed in the 2007 fires. The region endures massive destruction and what happens? Sempra and SDG&E give out bonuses.

Sempra made profits of $1.1 billion last year, 14% higher than the year before. Shareholders can well afford the costs of insurance and SDG&E’s failures.

The Commission should know that there are many civil cases still pending in court. Mountains of evidence have yet to be aired.

SDG&E did not give state regulators access to evidence in the immediate hours of the fires. The utility impeded that investigation and it paid $14 million for its obstructionist behavior. Why did the utility refuse to give inspectors access to evidence? What do the 911 tapes indicate?

BEFORE the Commission shoves a bill across the table to ratepayers, it needs to know the severity of the wrongdoing and the extent of the damage. We have got to let justice take its course. 

Apart from the 2007 fires, the mechanism SDG&E is proposing for future fires is a public policy nightmare. SDG&E wants to be indemnified by ratepayers for fires caused by its equipment in the future.

What incentive does the utility have to property maintain its wires when the utility has an automatic public bailout for future damages? That’s not an incentive. It’s a set up with ratepayers are being the ones set up. 

SDG&E may talk about how much it wants to harden the grid and how much it attends to its infrastructure. Yet, it’s asking ratepayers to guarantee the grid’s safety. The County and other public agencies are actively working with SDG&E on fire safety issues. That should not include a blank check from the people of this region for future wildfires.

I want to thank the Commission in advance for acting as true regulators… for not allowing SDG&E to burn this region a second time.  The civil cases need to be adjudicated before any unprecedented shift of liability. The utility’s ample profits must be directed toward grid safety. And, the Commission cannot give SDG&E a free pass to ignore its safety obligations into the future.