City Attorney, Consumer Group Complain : SDG&E; Hire in Rate Case Called Illegal

The San Diego city attorney’s office and a consumer group charged Thursday that San Diego Gas & Electric Co. violated state law when it hired former Public Utilities Commissioner Victor Calvo to testify for the utility in an ongoing rate case that Calvo reviewed while on the commission.

Conflict Also Claimed

The Utility Consumers Action Network also asked the state Fair Political Practices Commission to determine whether SDG&E; violated the state conflict of interest law that prohibits former state officials from serving as paid consultants.

Calvo’s testimony earlier this year focused on an arcane “balancing account” that was created to ensure that SDG&E; acquires low-priced electricity.

Calvo, who retired in December after six years on the commission, Thursday denied any wrongdoing. SDG&E; said Calvo, now a self-employed consultant in San Francisco, will be paid about $200 an hour, or a total of $10,000, for his testimony.

“I have followed the letter of the law,” Calvo said. “I talked to the best legal counsel about whether I should testify or not . . . and the law says that I can appear.”

Move Called OK

Hiring Calvo as an expert witness was “consistent with state law,” according to Bill Reed, manager of regulatory affairs at SDG&E.; The utility also asked commissioners to grant Calvo an exemption from the conflict of interest law because he has “unique qualifications” that other witnesses lack, Reed said.

A PUC administrative law judge may rule on Calvo’s ability to testify, according to PUC spokeswoman Carol Kretzer. However, the law judge probably will turn the matter over to the commission. Its next scheduled meeting is July 8.

UCAN’s executive director, Michael Shames, and San Diego Deputy City Atty. William Shaffran argued that SDG&E; should have withheld Calvo’s testimony until after the commission ruled on the exemption request. The city attorney’s office lodged a formal complaint Wednesday with the PUC.

During a Thursday press conference, Shames downplayed the “unique” nature of Calvo’s testimony and instead suggested that SDG&E; hired Calvo solely with the hope that he would impress newer commission members with his knowledge of “back room deliberations” at the PUC.

The debate over Calvo’s testimony is linked to a “balancing account” that the PUC created in 1985 to ensure that SDG&E; properly managed the purchase of electricity that is carried into San Diego County by the Southwest Powerlink transmission line.

The commission unanimously voted to create the balancing account in 1985, despite objections from SDG&E.; In 1986, when the commission agreed to review portions of the balancing account mechanism, Calvo wrote a dissenting opinion that called for abolishing the account.

Shaffran and Shames suggested that SDG&E; could have avoided the current dispute by simply presenting Calvo’s 1986 dissenting opinion.

SDG&E; spokesman Dave Smith suggested that “UCAN doesn’t want Vic Calvo’s testimony allowed because it’s devastating to their case.”