AT&T Challenges Pacific Gas and Electric's Wildfire System Hardening Plan

Strategic Insights -

The California Public Utilities Commission has been dealing with the issue of wildfire system hardening, particularly the proposal by Pacific Gas and Electric (PG&E) to underground significant portions of its overhead power lines. In its reply brief, AT&T California challenges PG&E's plan, citing massive uncertainty surrounding the proposal. This uncertainty, according to AT&T, precludes the Commission from assessing the merits of the proposal, affecting its impact on other parties and priorities such as broadband deployment. AT&T argues that PG&E has failed to demonstrate that undergrounding on the proposed scale and timeframe is feasible and that the company cannot explain why its shift towards relying on undergrounding provides the best cost-benefit mix.

Key Takeaways:

  • AT&T argues that PG&E's undergrounding proposal is plagued by uncertainty, leaving the Commission unable to assess its merits.
  • The proposal's uncertainty affects the impact on other parties and priorities, such as broadband deployment.
  • AT&T claims that PG&E has failed to demonstrate that undergrounding on the proposed scale and timeframe is feasible.
  • The company cannot explain why its shift towards relying on undergrounding for wildfire mitigation provides the best cost-benefit mix.
  • AT&T and other impacted parties argue that phone and internet companies should not bear costs associated with PG&E's wildfire mitigation efforts.
  • The Commission needs to devise a new, updated cost recovery mechanism for telecommunications carriers and cable companies to recover their undergrounding costs in a competitive environment.
  • PG&E's claims of "coordination" with AT&T and other parties do not alleviate concerns regarding the proposal.

Statistics:

  • PG&E's proposed undergrounding initiative covers a distance of 10,000 miles.
  • The estimated cost of the initiative is $10 billion.
  • The current process for recovery of undergrounding costs focuses on aesthetic purposes.
  • The applicable AT&T Tariff Schedule has a maximum rate history of 10.64% from 2012 to 2023.
  • The document can be viewed at: http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M499/K773/499773140.PDF

Sources:

  • [State Statutes] Cal. Pub. Util. Code § 451
  • [Rules] Cal. Pub. Util. Rule 13.11
  • [Other Authorities] D.01-12-009, Interim Opinion Revising the Rules for Converting Overhead Lines to Underground (Cal. P.U.C. Dec. 11, 2001) at 26
  • D.18-12-021, Application of California-Am. Water Co. (U210w) for Authorization to Increase Its Revenues for Water Serv. by $34,559,200 or 16.29% in the Year 2018, by $8,478,500 or 3.43% in the Year 2019, & by $7,742,600 or 3.03% in the Year 2020 (C.P.U.C. Dec. 13, 2018)
  • D.98-10-058, Order Instituting Rulemaking on the Commission's Own Motion Into Competition for Local Exchange Service (Cal. P.U.C. Oct. 22, 1998) (R.95-04-043) at 90
  • D.11-06-038, Order, Re Modifications to the California Advanced Services Fund (C.P.U.C. Jun. 23, 2011) at 1