Are You Kidding Me

Edison, SDG&E, say $4.7 billion pact is in the public interest

By Jeff McDonald
June 26, 2015 – 4:58 p.m.

Southern California Edison and San Diego Gas & Electric have petitioned state regulators to reject the suggestion that the $4.7 billion settlement deal for the failed San Onofre nuclear plant be reopened.

In separate responses to a request by The Utility Reform Network or TURN, a Bay Area consumer group, the two utilities said the California Public Utilities Commission would be setting a bad precedent to abandon the agreement that assigns customers 70 percent of premature closure costs.

“Vacating a settlement that the commission has already found to be in the public interest (and that TURN still believes was favorable to customers) would undermine public confidence in the commission’s processes, not restore it,” majority owner Edison said in its 11-page response. “The parties settled after 10 months of negotiations.”

SDG&E, which owns 20 percent of the plant on San Diego County’s north coast, submitted a nine-page response asking the commission not to grant the TURN request.

“The only rationale that TURN provides for why the settlement should be overturned is its belief that ‘the public perception [of] the settlement process was fundamentally and irreparably tainted and drove outcomes that are unfair to ratepayers’,” SDG&E said. “‘Public perception’ has nothing to do with the actual merits of the settlement.”

The commission and utilities have been criticized as details of private communications between regulators and Edison executives have emerged in recent months. Three months after the San Onofre deal was approved, Edison disclosed that an executive met in secret with former President Michael Peevey in Warsaw, Poland, to discuss a framework for settlement.

Peevey and other commission officials are the subjects of ongoing criminal investigations by state and federal authorities, who have focused on the so-called ex parte communications between regulators and the companies they are entrusted to oversee.

The private discussions are permitted, although they have to be disclosed within three days if one of the parties to a case makes substantial comments about a pending proceeding. Under the rules, the conversations do not need to be reported if the decision-makers do all of the substantive talking.

At the March 2013 meeting, Peevey and former Edison vice president Stephen Pickett jotted down the framework of a settlement. Many of the deal points made it into the eventual settlement, although some were revised.

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