CPUC Approves SDG&E, SoCalGas Rate Increases

San Diego, CA — Electric bills will soon rise by about 1 percent for customers of San Diego Gas & Electric in San Diego and Orange counties, while gas bills for customers in Southern California Gas Company's territory will rise by about 3 percent.

The rate increases for 2016-2018 were set Thursday by the California Public Utilities Commission as part of a modified settlement agreement to ensure both companies have sufficient revenue to ensure the long-term safety of their infrastructure.

The decision provides the necessary funds for SDG&E and SoCalGas — both owned by San Diego-based Sempra Energy — to perform pipeline inspection, testing and maintenance work on their gas transmission and distribution pipelines that they are required to do by state and federal law, and allows the companies to maintain and replace their aging electric and gas infrastructure at reasonable cost, according to the CPUC.

"Compared to current rates, we estimate that for residential customers the average SDG&E electric bill will increase by about 1 percent, the average SDG&E gas bill remains about the same, and the average SoCalGas bill will increase by about 3 percent," said CPUC President Michael Picker, the commissioner assigned to the proceeding.

The agreement authorizes a 2016 required revenue amount of $1.79 billion for SDG&E’s combined operations— $1.48 billion for its electric operations, and $309 million for its gas operations — which is $104 million lower than what SDG&E had requested.

It also adopts a 2016 revenue requirement of $2.20 billion for SoCalGas — $127 million lower than what SoCalGas had requested.

The CPUC said it "closely scrutinized" both companies prior authorizing the revenue requirements.

The agreement requires SoCalGas to separate the costs of repairing the Aliso Canyon leak so that the costs are not included when the company files its next rate case.

It also prohibits SDG&E from compensating its employees, managers and executives on the basis of SDG&E’s recovery of monies from consumers for 2007 wildfire-related costs that are being litigated before the CPUC.

Further, SDG&E is required to lessen potential wildfire risks by ensuring that funds are allocated for the trimming of vegetation near overhead electric lines and the replacement of many of its wooden poles with steel poles.

"What is important in this decision is the close scrutiny that the CPUC gives to the activities of these companies to ensure the long-term safety of their infrastructure," said Commissioner Liane Randolph. "In everything from safety reporting to storage field risk assessment to the formulas determining executive compensation, the CPUC is paying close attention to how SoCalGas and SDG&E spend consumer dollars."

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