Tuesday, March 26, 2019

Wildfires Color California PUC Utility Decisions

By Jason Fordney

SAN FRANCISCO — Utilities are dealing with several wildfire-related proceedings at the California Public Utilities Commission, which is exploring taking a larger role in responding to natural disasters and emergencies.

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The CPUC passed a series of electric-related emergency measures for utility customers | © RTO Insider

The commission Nov. 9 unanimously approved a series of emergency protections for electric ratepayers affected by the wildfires, but it delayed until Nov. 30 a decision on whether San Diego Gas & Electric (SDG&E) will be a permitted to recover costs from fires occurring a decade ago.

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Picker | © RTO Insider

Up to 30 separate fires raged in Northern California in October, prompting PUC President Michael Picker to discuss an increased role for the commission in responding to such events, such as sending out recovery teams to help residents.

“There seems to be more effective things we can do as people move into recovery,” Picker said. “I am curious to see whether we can institutionalize this in a more formal way.”

The commission’s decision requires utilities to waive deposits for residents re-establishing residential electric and gas service and stop billing homes that cannot receive service. It also disallowed disconnections for nonpayment and extended payment options, among other protections.

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Randolph | © RTO Insider

“It’s not as if this is the only catastrophe that we are going to have to respond to,” Picker added. “They are clearly increasing more in frequency and severity.” The PUC also heard about widespread loss of telephone service during the emergency because of power outages and structural damage.

“Acting quickly to protect consumers that have been affected by these tragic fires is very important,” said Commissioner Liane Randolph, highlighting the suspension of customer referrals to collection agencies.

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Guzman-Aceves | © RTO Insider

Commissioner Martha Guzman-Aceves noted that utilities “are already acting on many of these under their own discretion,” and “it is one of those positive incidences where everyone is working towards the same end.”

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Peterman | © RTO Insider

Commissioner Carla Peterman suggested exploring a set of standard protections and memorandum accounts to track costs. She also thought protections for small businesses and institutions should be explored.

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Rechtschaffen | © RTO Insider

“These are quick responses — we may need to do much more,” Commissioner Clifford Rechtschaffen added.

At the meeting, the PUC also temporarily waived the regulatory requirement that Pacific Gas and Electric charge affected customers for electric service related to wildfires. The utility asked for permission to waive the cost of estimated installation and remove costs to provide temporary power. It will instead include the costs in a future application under its Catastrophic Event Memorandum Account.

PG&E Fights Wildfire Lawsuits

PG&E is already fending off legal action related to the most recent fires. The utility on Nov. 9 asked the Judicial Council of California for a stay of 15 lawsuits by residents regarding fires that occurred within 12 counties. The company said that preliminary investigation shows that one blaze, the Tubbs fire, could have been caused by utility equipment installed by a third party not named in the suits.

“Although plaintiffs have rushed to file complaints while the fires are still burning, the reality is that no one knows what caused any of the fires,” PG&E said. “For the fires that cause can be determined, the cause could be a variety of factors.”

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PG&E is facing lawsuits after the northern California wildfires in October

It said the fires had many different locations, causes and damages.

“Plaintiffs’ effort to lump the fires together, both in their complaints and with respect to coordination, is an attempt to diminish their burden of proof with respect to causation,” PG&E said.

PG&E Files to Close Diablo Canyon

The commission is due to vote next month on whether to allow PG&E to retire the Diablo Canyon nuclear power plant in San Luis Obispo by 2025.

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PG&E plans to retire the Diablo Canyon nuclear power plant by 2025

The PUC’s interim chief administrative law judge, Anne Simon, issued a proposed decision on Nov. 8 allowing the utility to retire the 2,240-MW plant and collect about $1.8 billion in costs from ratepayers. About $1.3 billion of that amount is to implement energy efficiency measures to replace the plant’s capacity.

PG&E first filed with the commission in August 2016 to retire the plant, submitting a proposed settlement between the utility, San Luis Obispo County, several local cities and environmental groups regarding the closing of the facility. (See PG&E Files Diablo Canyon Shutdown Request.)

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The CPUC met on November 9 at its headquarters in San Francisco | © RTO Insider

The company proposes to close both units at the plant upon the expiration of their licenses: Nov. 2, 2024, for Unit 1 and Aug. 26, 2025, for Unit 2. The utility said there is less need for the plant because of new energy efficiency, distributed generation, renewable generation and customers moving to community choice aggregators and direct access.

“In fact, PG&E believes that the continued operation of Diablo Canyon beyond 2025 would exacerbate overgeneration, requiring curtailment of renewable generation,” Simon said in the decision. “PG&E’s analysis indicates that there is no need to replace Diablo Canyon in order to maintain system reliability.”

The proposed decision found that electricity procurement to replace the capacity should be obtained through the state’s integrated resource planning proceeding.

PG&E has requested approval to procure three tranches of greenhouse gas-free resources to partially replace the plant’s output; retention, retraining and severance for Diablo Canyon employees; and recovery of other costs.