Agreement Reached on San Onofre Nuclear Plant Closure Costs

Agreement Reached on San Onofre Nuclear Plant Closure Costs

SDG&E customers expected to save approximately $160 million

SAN DIEGO, January 31, 2018 – San Diego Gas & Electric (SDG&E) executed a settlement agreement yesterday with Southern California Edison (SCE) and nearly a dozen interested parties which, if approved by the California Public Utilities Commission (CPUC), would resolve the current inquiry into the retirement of the San Onofre Nuclear Generating Station (SONGS).       

The settlement would remove the remaining costs related to the SONGS closure from SDG&E customer bills. Under previously approved rate structures, customers would have incurred costs through January 2022. SDG&E estimates its customers will save approximately $160 million as a result of the proposed settlement.

“This settlement concludes the final chapter of the investigation into the original SONGS settlement and related events,” said Lee Schavrien, SDG&E’s chief regulatory officer.

In 2013, SCE, as the majority owner and operator of SONGS, closed the plant and began decommissioning activities.

The settlement comes after a multi-year investigation by the CPUC into the closure of SONGS and related costs. In 2014, the parties reached a settlement regarding the allocation of costs between the utilities and their customers, which was approved by the CPUC. After allegations of improper communications between SCE and the CPUC surfaced, however, the CPUC reopened the proceeding to investigate the claims and determine if the alleged communications impacted the previous settlement. No violations were alleged to have been committed by SDG&E and no penalties were assessed on SDG&E.

The newly proposed settlement was agreed upon by multiple parties actively involved in the CPUC proceedings including SDG&E, SCE, the Alliance for Nuclear Responsibility (A4NR), the California Large Energy Consumers Association (CLECA), California State University (CSU), Citizens Oversight/The Coalition to Decommission San Onofre (CDSO), the Coalition of California Utility Employees (CUE), the Direct Access Customer Coalition (DACC), Ruth Henricks, the Office of Ratepayer Advocates (ORA),  The Utility Reform Network (TURN), and Women’s Energy Matters (WEM).

SDG&E and its parent company, Sempra Energy, issued a Form 8-K today with the Securities and Exchange Commission with details of the financial terms of the settlement agreement as well as a brief summary of a separate agreement entered into by SDG&E and SCE in which Edison has agreed to pay SDG&E for what SDG&E would have recovered from customers in the original 2014 settlement agreement. There can be no assurance that the CPUC will approve the proposed settlement agreement or not take other action adverse to SDG&E in connection with the closure of SONGS and related events.

SDG&E is an innovative San Diego-based energy company that provides safe, reliable, clean energy to better the lives of the people it serves in San Diego and southern Orange counties. The company has been recognized by the U.S. Environmental Protection Agency for leadership in addressing climate change, was the first to meet California’s goal of delivering 33 percent of energy from renewable sources, has fueled the adoption of electric vehicles and energy efficiency through unique customer programs, and supports a number of non-profit partners. SDG&E is a subsidiary of Sempra Energy (NYSE: SRE), a Fortune 500 energy services holding company based in San Diego. For more information, visit SDGEnews.com or connect with SDG&E on Twitter (@SDGE), Instagram (@SDGE) and Facebook.

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Factors, among others, that could cause our actual results and future actions to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: actions and the timing of actions, including decisions, new regulations, and issuances of permits and other authorizations by the California Public Utilities Commission, U.S. Department of Energy, California Division of Oil, Gas, and Geothermal Resources, Federal Energy Regulatory Commission, U.S. Environmental Protection Agency, Pipeline and Hazardous Materials Safety Administration, Los Angeles County Department of Public Health, states, cities and counties, and other regulatory and governmental bodies in the United States and other countries in which we operate; the timing and success of business development efforts and construction projects, including risks in obtaining or maintaining permits and other authorizations on a timely basis, risks in completing construction projects on schedule and on budget, and risks in obtaining the consent and participation of partners; 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