On Wednesday, the California Public Utilities Commission (CPUC) issued two Proposed Decisions that would authorize ratepayer increases for PG&E customers through 2026. The first Proposed Decision (PD), authored by the Proceeding’s Administrative Law Judges, would increase ratepayer costs 13% while the Alternate Proposed Decision (APD), authored by Commissioner John Reynolds, would increase costs by 9%; PG&E requested a 26% rate increase. PG&E requested approval to underground 2,000 miles of powerlines in this General Rate Case (GRC) to meet their 10,000-mile undergrounding initiative that proposes to bury one-third of PG&E’s overhead assets in high fire threat districts.
The Proposed Decision (PD) would authorize undergrounding 200 miles of overhead distribution lines and largely favors the installation of insulated covered conductor on 1,800 miles as a reasonable wildfire safety investment. The PD estimates it would cost $3.3 million per mile to underground, versus $800,000 per mile for covered conductor and notes that “the ratepayers’ ability to pay for safety or risk reduction is not unlimited.” The PD also cites the benefits of covered conductor to reduce the need for Public Safety Power Shut-offs (PSPS) and fast-trip outages (the EPSS program). Generally, the PD is very skeptical of PG&E’s undergrounding plans, including the pace of construction and the forecasted costs, and ultimately concludes the benefits of undergrounding do not outweigh the lower costs and faster implementation of covered conductor to reduce risk and improve reliability.
The Alternate Proposed Decision (APD), on the other hand, adopts a “hybrid” approach for wildfire risk reduction by authorizing 973 miles of electric distribution lines to be undergrounded and installing 1,027 miles of covered conductor. The APD estimates it will cost $3.3 million per mile to underground in 2023 and relies on PG&E’s assertions that costs will decrease over time to approximately $2.8 million per mile by 2026; the APD estimates it will cost $1.2 million per mile to install covered conductor. Generally, the APD provides PG&E the opportunity to prove it can perform its undergrounding ambitions while attempting to balance costs, feasibility, and affordability across the GRC. PG&E is expected to submit a 10-year undergrounding plan pursuant to Senate Bill 884 that created a pathway for expedited approval for undergrounding electric infrastructure.
In both cases, the CPUC proposes to authorize $1.3 billion for vegetation management, and $2.5 billion for capacity upgrades. Unlike PG&E’s proposed 2023-2025 Wildfire Mitigation Plan (WMP), PG&E’s GRC transitions to a “One Veg” program. Neither the WMP nor GRC discuss wood haul of large, felled debris, which continues to be of great concern and importance to RCRC. Wood haul is a crucial component of successful vegetation management activities; hazard trees that are felled but not timely removed impact defensible space and transfer risk and liability onto property owners and communities by adding significant fuel load in the event of a wildfire.
RCRC is not a formal party to this proceeding but continues to engage with various state agencies to ensure the safe, reliable and affordable delivery of power to rural counties. The CPUC expects to vote on this matter on November 2, 2023. Public comments can be made here. For more information, please contact RCRC Policy Advocate, Leigh Kammerich.