By Hudson Sangree
The California Public Utilities Commission authorized costs for a new safety program as part of a utility’s general rate case (GRC) for the first time Thursday, when it approved rate increases for San Diego Gas & Electric and Southern California Gas.
The unanimous approval of the utilities’ three-year general rate case included costs associated with the CPUC’s Risk Assessment Mitigation Phase (RAMP) program.
The “applicants are the first utilities to incorporate RAMP into their GRC filings, and these costs are being included in [their] respective revenue requirements for the first time in [test year] 2019,” the CPUC said in its decision.
Both companies are owned by Sempra Energy.
The RAMP program is part of the CPUC’s efforts to address disasters caused by the state’s three big investor-owned utilities, such as the San Bruno gas pipeline explosion and recent wildfires. The program, and the related Safety Model Assessment Proceeding (S-MAP), require the IOUs to examine the risks they face and propose strategies to mitigate those risks, which the CPUC must then approve.
The utilities’ RAMP reports would eventually be integrated into their GRCs every three years, the CPUC decided. The SDG&E/SoCal Gas rate case was the first time that happened.
“The SDG&E and SoCalGas RAMP proceeding is an opportunity for large California investor-owned utilities to describe their proposed mitigations for safety risks associated with the operation of their assets,” the CPUC said on its website.
For SDG&E and SoCalGas, the rate-case decision filled nearly 800 pages, following a two-year review in which 20 parties intervened and 500 exhibits were entered into evidence, said Liane Randolph, the commissioner assigned to the rate case.
The result included a $1.99 billion revenue requirement for SDG&E’s combined operations and $2.77 billion for SoCalGas in 2019, with adjustments allowed in 2020 and 2021. A typical residential customer will see an increase of $1.01/month (0.7%) for electric service and $4.50 to $5 (about 14%) a month for gas service, Randolph said.
“However, a large part of the increases represents costs for incremental safety-related programs and activities that are being added to the GRC for the first time as a result of the … RAMP process,” Randolph told her colleagues at Thursday’s meeting. “The RAMP process requires SDG&E and SoCalGas to identify key safety risks and to propose programs that mitigate those risks.”
Programs being approved address wildfires caused by utility equipment and catastrophic damage from pipeline failures. Among SDG&E’s programs are 3D imaging that lets the utility assess the risk of pole failure because of winds and third-party attachments to poles, Randolph said. A gas leak survey process that uses electronic mapping is another example, she said.
RAMP costs are part of the PG&E’s next rate case, which the CPUC plans to decide in early 2020.