California regulators have delayed — again — a closely watched vote on whether electric utility companies can make their customers pay some of the costs of wildfires sparked by their equipment.
The California Public Utilities Commission had been scheduled to vote Thursday on a request from San Diego Gas & Electric Co. to pass on to its customers some of the settlement costs of lawsuits triggered by a series of fires in 2007. But on Tuesday, the commission put off voting on the issue until its Nov. 30 meeting.
That marks the second time in the last month that the commission has delayed making a decision in the proceeding, which has already dragged on for years.
A commission spokeswoman said the agency needed more time to review public comments on the issue. Two administrative law judges at the commission recommended in August that the agency’s five voting commissioners reject SDG&E’s request.
The decision could have big implications, and not just for SDG&E. State fire investigators are now trying to determine whether power lines and other equipment owned by Pacific Gas and Electric Co., California’s largest utility, helped start October’s devastating Wine Country wildfires, which killed at least 43 people.
SDG&E wants to pass on to its customers $379 million of the $2.4 billion the company paid to settle lawsuits connected to wind-driven wildfires in October 2007, which investigators linked to the company’s equipment. Both Pacific Gas and Electric Co. and Southern California Edison support SDG&E’s position and have spent the last two months lobbying the commission’s staff on the issue.
SDG&E decided to settle the suits in part because under a legal doctrine called “inverse condemnation,” utilities in California can be held liable for economic damages from fires started by their equipment, even if the companies followed all applicable safety regulations. PG&E now faces inverse condemnation in lawsuits connected to the 2015 Butte Fire, which killed two people.
PG&E reported last week that its Butte Fire costs will probably top $1.1 billion, substantially above the company’s $922 million in available liability insurance. During a conference call with Wall Street analysts, CEO Geisha Williams said that should the lawsuit costs exceed PG&E’s insurance, the company will ask the commission to pass those costs on to its customers.
Williams also said that if investigators tie the Wine Country fires to PG&E’s equipment, the utility would fight any effort to use inverse condemnation to make PG&E pay for the damage. If courts applied inverse condemnation anyway, PG&E would try to pass some of those costs on to customers, Williams said.
“Our costs over and above insurance coverage should be shared by all customers,” she said.
Four state legislators, meanwhile, plan to introduce a bill in January that would prevent utilities from making their customers pay such wildfire-related costs, at least in cases where the utility was found to be negligent.
The Utility Reform Network consumer group fears the commission may be having second thoughts about rejecting SDG&E’s request.
“For the PUC to immediately vote on and approve the (administrative law judges’) proposal would send one signal, to constantly delay a decision sends another,” said group spokeswoman Mindy Spatt. “We don’t know why it’s taking them so long to say no to SDG&E.”