Southern California Edison residential customer bills will increase by about 9 percent, or $12.41 per month, under the utility's approved revenue requirement for 2021, the California Public Utilities Commission unanimously approved this week. Rates are going up in part to pay for thousands of miles of covered conductors in SCE's high-fire-risk areas.
CPUC member Clifford Rechtschaffen at an Aug. 19 meeting said the commission should not "sugarcoat" the "significant" rate hike. "We got over 500 comments . . . many of those raised concern over rate impacts," he said.
The average residential monthly bill increase for California Alternate Rates for Energy customers is $8.39, or 8.9 percent, the decision says.
The commission approved a revised decision on the matter on Aug. 19—i.e., the day of the commission's voting meeting. The commission's revised decision approves SCE's $6.9-billion base revenue requirement for 2021, which is about 7.6 percent greater than its current revenue amount. The additional revenue will allow the investor-owned utility to provide safe and reliable service to customers, while opening a reasonable opportunity for the utility to earn the rate of return, the decision says.
"A significant component of SCE's request in this application is for capital expenditures, particularly as it relates to mitigating wildfire risk," the decision says. "This decision makes substantial reductions to SCE's forecasts, focusing on wildfire mitigation measures that are cost-effective and that target SCE's highest risk circuits."
SCE's post-test year revenue requirement will increase by about 5.5 percent, or $382 million, in 2022, and about 6 percent, or $437 million, in 2023, the decision says.
The CPUC gave approval for SCE to install about 4,500 miles of covered conductors. SCE proposed to cover about 6,200 miles of its conductors for about $3.4 billion between 2019 and 2023. The Utility Reform Network disagreed, proposing instead for SCE to install 2,500 circuit-miles of covered conductor for $892 million. Covered conductors do not completely eliminate the risk of utility-caused wildfires, the decision says. SCE did not commit to reducing public-safety power shut-off execution after installation of covered conductors, the decision says.
SCE's energy storage growth projections for 2020-2023 are less than the amount of energy storage growth seen in its territory in 2018, the CPUC said. Therefore, the commission will not authorize any additional funding for certain activities related to energy storage, the decision says.
SCE's transmission infrastructure activities will include insulator washing and underground infrastructure inspections. The utility will also begin to inspect one-third of its infrastructure using aircraft in non-high-fire-risk areas every year.
At the meeting, the commission also approved a decision meant to keep mobile home park owners from raising tenants' rents after participating in the CPUC's Mobile Home Park Utility Conversion Program. A serious unintended consequence of the conversion program could be significant rent increases for MHP tenants after electric and natural gas infrastructure in the park is improved, TURN representatives said in the approved decision. The commission should consider requiring assurance from park owners regarding near-term rent increases as a condition of participation, TURN representatives said. Phase 2 of the MHP proceeding might create mobile home park electrification standards, the decision says.
At the meeting, the commission also took the following actions:
- Added 1,960 acres in Healdsburg to the CPUC's fire-threat map. City representatives in 2017 proposed that the area be added as a "Tier 2" area on the map.
- Approved SCE's request to recover about $81 million in operations and maintenance expenses related to the state's drought in 2017-2018 and to certain wildfires in its territory. The commission denied SCE's request to recover costs associated with the Thomas and Rye fires because the IOU did not provide information as to whether it prudently maintained its infrastructure related to the fires, the commission said in the decision.
- Ratified the Office of Energy Infrastructure Safety's comments on SCE's 2021 wildfire mitigation plan. The commission is requiring SCE to provide a progress report on its wildfire mitigation work to the office by Nov. 1.
- Created a flat-rate approach for small businesses in Bear Valley Electric Service's territory. Bear Valley's volumetric dispersion of the climate credit program for small businesses did not meet the California Air Resources Board's cap-and-trade regulation, the decision says. The decision also ordered Bear Valley Electric to use the processes established by IOUs in the state for its auction-proceeds distribution methods for emissions-intensive-trade-exposed small business and residential customers.
- Requested that San Diego Gas & Electric conduct an additional combined-heat-and-power generation request for offers before Dec. 31 in order to meet the utility's CHP capacity and greenhouse gas emissions-reduction goals. If SDG&E does not find a contract through its RFO process, the utility must submit an advice letter to the commission that documents the reasons why a contract failed to appear.
- Approved the sale of Pacific Gas & Electric's main office in San Francisco to Hines Atlas U.S. LP for $800 million. The main office consists of multiple buildings: 215 Market Street, 245 Market Street, 77 Beale Street and 45 Beale Street, all in San Francisco. PG&E will lease about 134,000 square feet of the buildings through 2023. Its new headquarters will be located at 300 Lakeside Drive in Oakland.