SDG&E; Seeks Change in Ruling That Cut ’86 Rates

San Diego Gas & Electric has asked the state Public Utilities Commission to revise a December decision that directed the utility to reduce its electric rates by $120 million during 1986.

The utility has asked the PUC to reconsider a formula that determines whether SDG&E; has used its Southwest Powerlink transmission line to import “high-cost” electricity from utilities in the Southwest.

On Friday, San Diego-based Utility Consumers Action Network Director Michael Shames suggested that SDG&E; was opposing a part of the rate-making decision which could save ratepayers at least $90 million during the next three years.

When the PUC issued its 1986 rate-making decision in December, it indicated that it leaned heavily upon “UCAN’s calculations (which) indicate that the utility has chosen to load the (Southwest Powerlink) with high-cost power.”

The PUC “has charged that (SDG&E;) loaded the line with expensive contracts, but those contracts were in effect at the time when the PUC authorized construction of the Southwest Powerlink line,” said Yole Whiting, SDG&E;’s general rate case project manager. “The PUC knew about these contracts in 1980 when the certificate (to build the line) was issued.”

“The PUC basically told SDG&E; that it shouldn’t have negotiated long-term, high-cost contracts to fill its Southwest Powerlink, and that it should immediately have started renegotiating those contracts once it realized the contracts were overpriced,” UCAN Executive Director Michael Shames said Friday.

The utility also has asked the PUC to revise an “avoided cost” formula that was included in the December decision. SDG&E; favors a formula that is based on costs which were predicted back in 1980 when the line was approved by the commission. The PUC settled on a formula that uses 1985 figures the utility believes are unrealistic, Whiting said.

“We just have some real problems with (the PUC’s Southwest Powerlink decision),” Whiting said. “It’s so glaringly inconsistent, incorrect and unfair.”

SDG&E; filed its request for a review earlier this month but the PUC has not yet determined if it will review its December decision.