A judge has raised several questions over a proposed $37 million settlement between Southern California Edison (SCE) and the State of California over the 2007 Malibu Canyon fire, including whether the $17 million Edison has pledged to inspect and replace faulty power poles in Malibu is sufficient.
The settlement, announced Monday last week, would see SCE pay $20 million to the State of California’s general fund.
It also calls for Edison to inspect an estimated 1,453 poles in the Malibu service area and then remediate—i.e., replace or repair— ones that do not meet safety standards. However, another section of the settlement stipulates that the work “will be limited by the amount of work that can be done with $17 million,” which Edison has pledged for the inspections and remediation, an inconsistency the judge has asked the state and the utility company to clarify.
“Will all these poles be assessed and remediated, even if $17 million is not sufficient?” Kenney wrote in a May 24 ruling to SCE and the state requesting more information.
It’s the same question Hans Laetz, who has been involved in the settlement negotiations as a citizen intervener, said he has posed to Edison.
“The way the agreement is written, after $17 million, Edison’s done, the whole special protocol inspection project is over,” Laetz said. “But $17 million isn’t a lot of money for the amount of poles that need to be fixed.
“They were saying this was a done deal, and I was saying holy mackerel, there’s all kinds of questions about this. And the judge looked at it for five days and came to the same [conclusion].”
To inspect and remediate an estimated 1,453 poles, the $17 million allots for about $11,700 to be spent on each pole inspection and necessary repairs.
Kenney noted that repair costs were not included in two other settlements pertaining to the 2007 fire, which began on Oct. 21, 2007, when three power poles next to Malibu Canyon Road failed in heavy Santa Ana winds and ignited dry brush nearby. AT&T, Verizon Wireless and Sprint jointly agreed to spend $5.1 million in surveys of power poles along Malibu Canyon Road, while under a pending settlement NextG has agreed to spend $8.5 million on a safety audit. Remediation costs were not accounted for in those settlements.
“It appears the two other settlement agreements…could assess and remediate more poles than the SCESED [State of California] Settlement agreement,” he added.
A spokesperson for Edison declined comment on Kenney’s specific questions, but said the company was preparing written answers to his ruling.
“Southern California Edison is preparing formal responses to similar questions posed by Administrative Law Judge Timothy Kenney on May 24. SCE anticipates providing these responses on July 3, as requested by the administrative law judge,” SCE spokesperson Lauren Bartlett wrote in an email to The Malibu Times Tuesday.
While the California Public Utilities Commission (CPUC) will ultimately choose to accept or deny the proposed settlement, a CPUC spokesman said Kenney’s questions will surely factor into the CPUC’s decision.
“There has to be a proposed decision that has to be issued for the commission to consider, and the proposed condition could be that the CPUC approve the settlement, it all is up to the judge,” said Christopher Chow, a CPUC public information officer.
Kenney’s ruling also requested clarification on other concerns. Among them is a question of how the pole inspections will be conducted. The settlement, Kenney wrote, did not clarify whether the inspections would solely be limited to power poles or also include pole elements such as cross arms. The distinction could be important, considering that heavy equipment attached to power poles has been listed as a prime cause of pole overloading in Malibu Canyon and other areas throughout the state.
Further, a report by the Los Angeles County Fire Department listed the dollar loss of the Malibu Canyon Fire as $14,528,300. Kenney questioned whether the $20 million penalty is reasonable in light of the CPUC’s criteria of economic harm, which the CPUC says should be larger than “the level of the costs imposed on the victims of the violation” or “the unlawful benefits gained by the public utility.”
Requests outlined in Administrative Law Judge Timothy Kenney’s ruling:
• The proposed settlement is unclear as to whether “pole-loaded assessments” will be limited to power poles, or if other pole elements such as cross arms will be assessed. “If not, why not?” he asked.
• The settlement stipulates that Edison will make periodic reports to the state on the status of its pole inspection program, but no mention is made of whether those reports will be made available to the public. “Will the periodic reports be available to the public?” Kenney wrote. “If so, how will the public access the reports? If not, why not?”
• A report by the Los Angeles County Fire Department listed the dollar loss of the Malibu Canyon fire as $14,528,300. Kenney questioned whether the $20 million penalty is reasonable in light of the CPUC criteria of economic harm, which the CPUC says should be larger than “the level of the costs imposed on the victims of the violation” or “the unlawful benefits gained by the public utility.”
• Kenney requested Edison provided its 2007 audited financial records and its most recent audited statements.