SDG&E seeks $250 million increase

UCAN’s teams of investigative analysts have been digging deep into SDG&E’s latest demand for a rate hike from the California Public Utilities Commission (CPUC).  

At stake is more than $250 million a year in rate increases.

So far, UCAN has hired five different consultancy companies to investigate SDG&E’s costs.

If SDG&E’s rate hike is approved, it will increase electric rates, on average, by 7% and natural gas rates by 6.9%.   The impact on a typical monthly bill would be about 10%  – about 3% for electric customers – and 7% for gas service.

SDG&E has crafted the proposed rate hike so that the brunt of the increase will be borne by residents and small businesses.

The details of SDG&E’s spending spree are disturbing.  The increased costs for its basic operating expenses (not the production of energy) add up to $123 million a year.  The utility also wants to increase its capital cost spending by $2.2 billion dollars.  This is why UCAN has hired five teams of investigators to begin a piece-by-piece review of the 25,000 pages of documents that SDG&E
has submitted to justify the increase in your rates.

We will hire more outside experts as  the investigation proceeds. Right now, UCAN’s hired guns are investigating eight highly questionable issues. Specifically:

1.  Why during a recession none of SDG&E’s
     costs appear to have gone down … only up.

2.  Why SDG&E’s managers aren’t provided with
     economic incentives to reduce costs.

3.  How SDG&E’s contract management  policies
     have resulted in dramatic overspending for
     services and goods.

4.  Was the money that SDG&E received from
     previous rate increases spent the way SDG&E
     claimed it was spent?

5.  Why SDG&E says its payroll and employee
     counts must increase even though new innovations
     such as Smart Meters (which don’t require meter
     readers) and other efficiency improvements will be
     lowering the utility’s labor costs.

6.  Why SDG&E is increasing its call center
     staff at a time when more customers than ever
     are conducting their business on the Internet.

7.  If forbidden lobbying expenses are being  
     secretly buried in SDG&E’s customer service
     costs.

8.   The truth behind SDG&E’s highly questionable claim
     that electric vehicles and photo voltaic solar energy will
     somehow cause SDG&E’s costs to increase.

By fall of 2011, UCAN should have a full report and summary of what our investigators have found.

Then, in December, the real battle begins:  UCAN will represent you, the ratepayer, in evidentiary hearings.   In the meantime, last November’s election may have turned the regulatory tide at CPUC in
favor of consumers (see story about CPUC's “Changing of the guard”).

This story originally appeared the June, 2011 UCAN Watchdog which is distributed to UCAN Members by mail in advance of being published on our Web site.

Learn about UCAN's benefits of membership HERE.

Help fund the fight HERE.

Other stories from the June 2011 UCAN Watchdog

Obituary for Dr. Sue Ann Macomber
SDG&E seeks $250 million rate hike
Sunrise appeal rejected
Utility Gripe? Complain to the UCAN Fraud Squad
Regulators are going to the Dark Side
Could this be the end of California's Public "Futility" Commission?
The silence of Harvard
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