The California Supreme Court has refused a request by PG&E to review a lower court decision the for-profit utility wanted overturned to derail South San Joaquin Irrigation District’s eminent domain efforts.
The high court’s decision not to review the case means SSJID can proceed with its legal efforts to force a sale of the PG&E system serving Manteca, Lathrop & Ripon in the irrigation district’s bid to reduce retail power rates at least 15 percent across the board for the three communities and surrounding farms.
The SSJID on Tuesday also prevailed in a filing ordering PG&E to pay legal costs SSJID incurred fighting in court over the past four plus years to be able to pursue its legal rights under the state constitution to use eminent domain given PG&E rejected above market offers to purchase the local distribution system.
Eminent domain, despite what PG&E has inferred over the years in what was a $1 million plus community advertising blitz to build ill will against SJJID, is something that PG&E welds quite often as a quasi-public institution. It is primarly used to locate power lines across private property to serve other customers in a manner that saves the company money regardless of the impact it has on the owner of the land.
“It’s a good solid victory,” SSJID General Manager Peter Reitkerk said of the two court rulings.
While the district is returning to a lower court to pursue its eminent domain case, Reitkerk cautioned the process may still take another three to five years to reach the SSJID goal of being the retail power provider for the three communities and adjoining rural areas that it serves.
If SSJID ultimately prevails it will lead to power bills that at the front end will be 15 percent lower than PG&E. That gap, if history is repeated where other agencies forced a sale of PG&E territory such as the Sacramento Municipal Utility District, will widen as the years pass.
It would mean local residents, businesses, and farms won’t help underwrite profits that flow primarily to Wall Street hedge funds. SSJID would be able to take advantage of lower interest rates based on its solid rated financial status to fund system upgrades.
If PG&E prevails more than 130,000 Manteca, Ripon, and Escalon residents will continue to be slammed with rate hikes attributed to the need to address years of the for-profit utility failing to effectively address long-term maintenance issues, a proposed $20 billion plan to underground power lines that are mostly 100 miles or more from SSJID and to keep the state guarantee of nearly a 11 percent return flowing into PG&E coffers and the pockets of their investors.
If the 18 years SSJID has invested so far to obtain the local PG&E system seems like a futile effort keep in mind it took 23 years after the people of Sacramento first moved to exercise their right to acquire their local retail system from PG&E to start delivering electricity in 1946 through SMUD.
What PG&E is doing to stop SSJID is almost a replay of their efforts in courts for almost a quarter of a century to stop SMUD.
Today SMUD’s average rates are 35 percent lower than what PG&E charges. Only a handful of utilities have lower rates than SMUD in California — Roseville Electric and Turlock Irrigation District. That difference is slight.
The gap between SMUD and other local, publicly owned utilities compared to PG&E continues to grow as PG&E’s annual rate increases are significantly higher.
Based on a California Public Utilities Commission (CPUC) analysis between 2002 and 2019 PG&E rates rose an average of 37 percent compared to the 19 percent the consumer price index rate rose. The data available for average local utilities for the 10-year period between 2008 and 2017 shows a 3.33 percent increase. While 20-year data was not available for all local utilities, based on SMUD only the increase in rates was less than 10 percent for the corresponding 20-year period or roughly a quarter of PG&E’s
To contact Dennis Wyatt, email dwyatt@mantecabulletin.com
