After the San Bruno natural gas pipeline explosion in 2010, the California Public Utilities Commission started looking hard at how utilities maintain those pipes throughout the state. That includes gas lines maintained by SoCalGas, a Sempra company. Pipeline safety is costly, so the CPUC asks utilities to submit their plans for what they’re going to do and how much it’s going to cost.
SoCalGas, together with the other Sempra company, San Diego Gas & Electric, forecasted that its plan would cost $1.7 billion, most of which, $1.4 billion, would be borne by SoCalGas customers.
Now the ratepayer advocate office at the CPUC has filed extensive testimony, saying Sempra’s shareholders should be on the hook for planned upgrades and maintenance for those gas lines.
The Division of Ratepayer Advocates has existed since the 1980s as a separate office meant to protect consumers. According to the DRA, it’s fair to make ratepayers pay for hydrostatic pressure testing of the oldest natural gas transmission lines, installed before 1935. But Sempra shareholders should pay for the work SoCalGas wants to do that’s above and beyond the minimum required by the state. So testing for pipes installed from 1935 onwards, and replacement of pipes installed in the past 57 years for which there aren’t good records, that’s the kind of work DRA says shouldn’t raise gas rates.
“SoCalGas customers need to be protected from the significant uncertainties of the utility’s pipeline upgrade proposal,” said Joe Como, the acting director of the Division of Ratepayer Advocates, in a press release. “To ensure that funds are spent prudently and only for their intended purpose, the CPUC should require that unspent funds are returned to customers.”
The CPUC will next take evidence on the question of whether the Pipeline Safety Enhancement Plan is a good one, and how the costs should be meted out: that happens at the end of August.