Late Friday, Sempra Energy’s San Diego Gas and Electric Co.(SDG&E) utility subsidiary filed with California stateregulators to increase one-time rate refunds to about $500 millionto take the bite out of summer electricity bills that have soaredfor its 1.1 million customers due to heat-induced power supply andprice spikes in May and June.

SDG&E asked the California Public Utilities Commission toaccelerate the return of about $100 million in excess revenues fromits continuing minority interest (20%) in the San Onofre NuclearGenerating Plant and some long-term purchase power contracts. Thiswould result in lower electric bills by $17 a month in August andSeptember, according to the San Diego-based combination utility.

Together with almost $400 million in electric restructuringcharges being returned in one-time refunds, the typical SDG&Eresidential electric customer should realize about $300 in raterelief, according to the utility calculations.

SDG&E continues to maintain that in California’s newderegulated electricity industry it is merely a “delivery serviceprovider,” or so-called “wires” company, and therefore it points tothe average prices in recent weeks for power through thestate-chartered California Power Exchange (Cal-PX), through whichSDG&E is required to buy all of its electricity, as the mainculprit for consumers’ high electric bills. The Cal-PX, on theother hand, has openly criticized SDG&E for not takingadvantage of various block-forward markets for hedging earlier inthe year to ease the full impact of summer peak prices.

In reality, a complex combination of market, infrastructure andstate regulatory factors have contributed to the high bills in thesouthern end of the state, while the bulk of the state’s electriccustomers for two other giant investor-owned utilities remainshielded by a rate freeze that’s been in effect for the past fouryears.

“We continue to be concerned about the impact high energy pricesfrom the Cal-PX are having on our customers, and we are working tomitigate this impact as much as possible,” said SDG&E PresidentEd Guiles. “Our customers need relief and we are hopeful the CPUCwill act quickly to accelerate the return of this money to them.”

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