Aftermath of a wildfire: A special interest vs. the public interest

A core belief here holds that special interests usually act in their own interest with little or no regard for the public interest, good, bad or indifferent. Special interests with money and power are generally more successful in getting what they want. The following is a clear example of how the endless fight of special vs. public interests can play out.

Although there apparently never was a full investigation, the evidence that was available indicated that San Diego Gas & Electric (SDG&E) was mostly or completely at fault for causing San Diego county wildfires in 2007. Over 1,100 homes were destroyed in the fires. According to a series of reports aired over the past several days by KBPS, NPR's San Diego affiliate, SDG&E prevented investigators from gaining access to evidence and its employees  because the company itself "had not finished its own internal investigation".

Wild turkeys doing whatever it is they do

San Diego east county mountains - April 2012

Setting aside the profoundly bewildering question of how it is possible for any company to block an investigation by any authority with jurisdiction into a major incident of this sort, there is an ongoing bitter fight over who is going to pay for SDG&E's culpability. The two interests potentially on the hook are SDG&E investors and SDG&E customers. Naturally, SDG&E argues that customers will have to pay hundreds of millions, maybe $1 billion, because (i) they are the people who benefit from the company's wonderful services and (ii) California law guarantees the utility a fixed profit.

San Diego customers, who now pay the highest utility rates in the U.S. (or nearly so), are outraged, incredulous and stunned that not only does SDG&E demand payment of SDG&E's mistakes, they are also being asked to (i) pay for all future costs like this regardless of fault, (ii) under circumstances where SDG&E may elect carry no liability insurance whatsoever. SDG&E doesn't like paying insurance premiums. A SDG&E spokesperson, opined that there was no way the utility would bear the cost of their own mistakes. That statement was a simple matter of fact with no overt regard whatever to anything other than SDG&E's financial interest.

Which interest is going to win?

It would be no surprise if the public gets stuck with the bill, despite several hours of public hearings with loads of venom directed at the utility from its irate but relatively defenseless customers. According to the KPBS reports, the defenders of the public interest, the California Public Utilities Commission (CPUC), are essentially unavailable to the public but fully accessible to the utility. On top of that, the head of the commission is a former high level SDG&E executive and the commissioners take tens of thousands from the utilities as "gifts".

Its politics as usual

This is an example of politics as usual. This is also an example of how the special vs. public interest fight plays out. The public has to defend itself because special interests and the government won't do it for them. Remember the recent SOPA fight? It was the public that had to stand up for itself because the government certainly wasn't going to do it. The same thing is quietly happening now with provisions of the Dodd-Frank Act that regulates Wall Street. Wall Street doesn't want to be regulated, regardless of any potential impact on the public interest.

Time, patience and money is on their side: If SDG&E loses today, they will just come back next year. If they lose next year they will come back the following year. Sooner or later, San Diego customers will pay for this one way or another because it takes too much focused effort to maintain their defense over time.

KPBS performed a remarkable public service in this because they harped on the topic for 3-4 days before the public hearings. Unfortunately, despite that attempt to defend us, SDG&E's relentless onslaught of money will eventually wear down the public's defense of itself. One can reasonably assume that CPUC is a lost cause but for the temporary glare of bad publicity. Once attention fades and SDG&E gets what it believes it deserves, the public will pay and pay and pay. If San Diego utility rates aren't already the highest in the U.S., they will be just a bit higher and closer to that lofty goal (SDG&E's goal, that is).