Utility Shareholders Should Pay for Pipeline Tests -- not Customers

The Division of Ratepayer Advocates, an independent group within the California Public Utilities Commission, has said that shareholders of San Diego Gas & Electric (SDGE) -- and not ratepayers -- should pick up the tab for natural gas pipeline safety upgrade costs. (The stock of Sempra Energy, parent of SDGE, trades in the market.) The pipeline testing operation would cost $235 million, and SDGE -- typical of its modus operandi -- wants its customers to pay for the tests over a long period of time. But the Division of Ratepayer Advocates points out that SDGE's pipeline program has failed to keep up with required state and federal laws. That makes it a management problem -- not something that should be piled on the backs of ratepayers. This is quite similar to SDGE's current attempt to get its customers to pay almost all uninsured costs of the 2007 fires, for which SDGE was found negligent. The problem is that the current CPUC commissioners are strictly pro-utility and anti-customer. It is not clear that the Division of Ratepayer Advocates will have any clout in the decision.

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