Nevada County: PG&E dodging power line bills
In addition to directly affecting wildfire concerns, energy availability and independence, PG&E’s extended unfolding bankruptcy proceedings could now cost Nevada County’s traffic mitigation fund.
The Board of Supervisors is asking the California Public Utilities Commission for help in compelling PG&E to pay its share of power line undergrounding costs after the utility company avoided paying the state-mandated fees for more than a year, pushing the county to take the money from elsewhere.
Under the utility commission’s Rule 20A, customers are charged about $1 a month — money put toward a fund earmarked to pay for a portion of a local government’s costs to bury power lines underground. That undergrounding reduces fire danger and service interruption risks.
Typically, a jurisdiction establishes an underground district for a project. Rule 20A funds are then allocated to the project and the jurisdiction works with the utility commission and the company that owns the power lines on a plan for implementing the project. Costs incurred by a jurisdiction are reimbursed by the Rule 20A funds.
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The county completed its Combie Road/Magnolia Road undergrounding project in September, but said the utility company has invoices unpaid from more than a year ago. As of December, PG&E listed the Combie/Magnolia undergrounding project as in construction phase.
Supervisors sent a letter of concern to the utilities commission at their last meeting, claiming PG&E owes the county $656,252.88 for unreimbursed costs on the project. According to board documents, the county invoiced PG&E a total of $669,927.22, of which it paid $13,674.34, leaving two invoices dated Feb. 18, 2019, and March 5, 2019.
“We’re hoping (the CPUC) can apply some pressure to PG&E to get the Rule 20A funds sent to us per the agreement that PG&E signed,” Public Works Director Trisha Tillotson said. “We’ve had to cover approximately $656,000 with Road Mitigation funds, so until we receive reimbursements for those funds in Rule 20A money from PG&E, that deficit is going to remain.”
The county has had to take the funds expected from Rule 20A out of a pool meant to mitigate the impacts of increased traffic from development projects, according to Tillotson, and expects it may have to draw from the fund in the future if it can’t collect from PG&E.
Those funds would have been likely used for intersection improvement projects on Ridge Road and Rough and Ready Highway. Costs vary widely by mitigation project, but the money taken from Road Mitigation funds would be unlikely to solely complete any one project, which typically total in the millions of dollars.
PG&E filed for Chapter 11 bankruptcy in January 2019, before the county’s invoices, and claims because it’s in the process of finalizing a reorganization plan, it’s not required to pay out the Rule 20A obligations, according to bankruptcy filings.
“Because PG&E is going through the bankruptcy that sort of disrupts the normal process (to resolve debt disputes), that’s what PG&E is telling us,” Tillotson said. “My opinion is that these Rule 20A funds are specifically set aside for undergrounding projects and therefore should not be part of the bankruptcy hearing.”
An October audit of how PG&E used the Rule 20A program revealed the company diverted $123 million from it, exacerbating wait times and increasing costs for projects. The audit also found the recent changes meant to improve effectiveness of the Rule 20A program have not increased their performance and revealed problems in the design, implementation and operation of the program’s controls.
The company hopes to exit bankruptcy negotiations by the end of June when a deadline to tap into a $20 billion state pool covering future fire losses will expire. Its reorganization plan will need approval from the utilities commission before it can move forward.
“Throughout the project… the county has diligently invoiced PG&E their fair share of the costs totaling $669,927.22,” the county’s letter of concern states. “This sum of money is a hardship for our rural county of 100,000 people to continue to cover.”
To contact Staff Writer John Orona, email email@example.com or call 530-477-4229.
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