WEDNESDAY AGGREGATE: Wildfire Financing, Gas Backbone Upgrades, IRP Procurement Pressure
Today's roundup spans wildfire securitization, compressor station upgrades, customer billing infrastructure, IRP ex parte communications, and Resource Adequacy scheduling.
- Woolsey Fire: in SCE's financing order application, Cal Advocates makes the opening challenge in what might be a hard-fought securitization battle.
- PG&E and the Hinkley Compressor Station Upgrade: PG&E's CPCN withdrawal and emergency exemption move is procedural arbitrage: move fast now, and litigate cost recovery in a General Rate Case.
- SoCalGas Customer Billing System: This is a cost-overrun battle, but a settlement with the Small Business Utility Advocates is a significant development.
- Integrated Resource Planning: A pending PD is fluid and both CalCCA and Cal Advocates are pushing against its perceived rigidity.
WOOLSEY FIRE
Cal Advocates filed a protest opposing SCE's application for a financing order to securitize approximately $1.951 billion in approved costs from the 2018 Woolsey Fire through recovery bonds repaid by ratepayers.
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While the underlying wildfire costs were previously authorized in a December 2025 settlement decision, Cal Advocates argues the CPUC must closely scrutinize whether issuing bonds (and imposing long-term fixed charges on customers) is truly just, reasonable, and in the public interest compared with traditional cost recovery.
The protest raises concerns about bond terms, duration, cumulative ratepayer impacts from prior securitizations, allocation of charges, financing costs, and whether the proposal actually reduces customer rates on a present-value basis.
INSTANT ANALYSIS: Cal Advocates' protest is the opening move in what will be a hard-fought securitization proceeding, not a rubber stamp. Cal Advocates is skeptical that recovery bonds automatically benefit ratepayers, especially given the growing stack of prior wildfire securitizations already embedded in bills. Expect heavy litigation over bond duration, interest costs, and cumulative bill impacts, areas where intervenors can reshape outcomes even after the underlying wildfire costs were approved.
If the Commission strengthens ratepayer protections or shortens bond maturities, the near-term rate profile could rise even if lifetime costs fall, affecting procurement assumptions and affordability narratives. This case also functions as a precedent test for how aggressively the CPUC will police post-Senate Bill 901 wildfire securitization tools going forward.
PG&E WILDFIRE & GAS SAFETY
PG&E recently filed a motion in its Wildfire and Gas Safety cost-recovery proceeding (A.23-06-008) to reopen the evidentiary record so it can introduce updated revenue requirements for 2023–2030 tied to capital costs already under review from 2020–2022 safety work.
PG&E argues that subsequent procedural developments (specifically the exclusion of these costs from both its 2023 and pending 2027 General Rate Cases pending reasonableness review) have stranded the associated revenue requirement until at least 2031, which would cause ratepayers to bear substantial additional interest expense.
PG&E therefore proposes admitting updated figures now and implementing final amounts later through a ministerial advice-letter process after the Commission rules on the underlying costs. PG&E frames this as a narrow, efficiency-oriented fix supported by some parties, estimating that earlier recovery could avoid $52.2 million in interest costs while not prejudicing intervenors because the ultimate revenue requirement would still depend on whatever costs the CPUC ultimately approves.
PG&E estimates total interest exposure reaches approximately $174.1 million if cost recovery is delayed to 2028. PG&E also cites a recent SDG&E precedent (D.26-01-021) in which the CPUC rejected the same Cal Advocates argument (that later-period revenue requirements require a separate proceeding) finding such a proceeding "unnecessary" when the underlying capital costs had already been reviewed.
- In a response dated February 17, Cal Advocates opposes the motion, arguing that reopening the record to consider 2023–2030 revenue requirements would exceed the defined scope of the proceeding, which is limited to reviewing the reasonableness of specific wildfire-mitigation and safety expenditures incurred mainly in 2020–2022.
- Cal Advocates contends PG&E is attempting to introduce a new issue long after the record closed, without adequate justification for why the evidence was not presented earlier, and warns that doing so could violate procedural rules, prejudice other parties, and potentially saddle ratepayers with interest costs stemming from PG&E’s own delay rather than from Commission action. Consequently, it urges denial of the motion and suggests any future recovery for later years should be pursued in a separate application with full discovery and hearings.
INSTANT ANALYSIS: PG&E is trying to prevent a ratemaking gap: safety capital already under review cannot enter rates until reasonableness is decided, but the GRC timeline would otherwise delay recovery for years, adding large interest costs. PG&E wants the Commission to treat the 2023–2030 revenue requirement as a mechanical update handled by advice letter rather than a new case. The SDG&E precedent is PG&E's strongest card (the Commission has already rejected this precise Cal Advocates argument once).
Cal Advocates argues this would improperly expand the proceeding’s scope and necessitates a separate application, which would push recovery further out and test whether those added carrying costs are recoverable. An eventual decision on this subject could shape how future safety spending converts into rates when regulatory timelines fall out of sync.
PG&E COMPRESSOR STATION UPGRADES
In a February 17 filing, TURN addresses PG&E's recent motion to withdraw its application for approval of electrical upgrades at the Hinkley Compressor Station. TURN argues that PG&E has not provided enough factual detail to justify using an emergency exemption to proceed without prior CPUC review.
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TURN also questions the project's scope, cost estimates, and underlying need, noting evidence that compressor capacity and related electrical work could potentially be reduced as gas demand declines and storage plays a larger role.
If the CPUC allows the withdrawal, TURN urges it to require strict conditions, including a full reasonableness review of project costs in the next General Rate Case, to prevent the expenditures from being added to rate base without scrutiny. TURN's particular concern is that costs incurred in 2025-2026 predate the next rate case base year and could be buried within a single budget line item covering both Hinkley and Topock stations, escaping meaningful review absent explicit CPUC direction.
INSTANT ANALYSIS: PG&E’s move to withdraw the CPCN application and proceed under an emergency exemption is a procedural end-run that shifts the battle from upfront need review to back-end cost recovery, where scrutiny is weaker and delayed. The true risk is not the project itself but the possibility that tens of millions in capital spending enter rate base years later with minimal interrogation, especially if intervenors lack a clean evidentiary record.
- And the gap is stark: the 2023 GRC authorized approximately $25 million combined for electrical upgrade work at both Hinkley and Topock compressor stations, against a $93 million estimate for Hinkley alone (with no Hinkley-specific costs included in the 2027 GRC forecast).
- TURN’s filing reframes the dispute around capacity planning: if compressor capacity can decline as storage substitutes for peak demand, then the electrical upgrade may be oversized relative to future system needs.
For gas utilities and large customers, the key implication is precedent: approval could normalize bypassing CPCN review for aging backbone assets by invoking reliability concerns, accelerating capital deployment ahead of formal policy direction on gas system contraction.
CUSTOMER INFORMATION INFRASTRUCTURE
SoCalGas's opening brief in A.25-05-004 asks the CPUC to approve $21 million in incremental funding to complete its Customer Information System (CIS) Replacement Project. The $21 million figure reflects a settlement SoCalGas reached with the Small Business Utility Advocates, down from the original $24.9 million application request.
This project is a major modernization effort to replace a roughly 30-year-old legacy billing and customer-service platform built on technology that will be over 40 years old at the time of implementation, underpinning core operations for 5.9 million accounts.
SoCalGas argues the previously authorized funding from its Test Year 2024 General Rate Case will be exhausted by September 2026 (before project completion in 2027), putting implementation, employee training, transition staffing, and retirement of legacy systems at risk without additional funds.
SoCalGas says the upgrade is necessary to address obsolete technology, maintain reliable billing and customer service functions, and meet evolving regulatory and business requirements. It claims the rate impact would be modest (about $0.31 per month for a typical residential customer). It also seeks approval of a two-way balancing account to reconcile forecast versus actual costs.
Cal Advocates disputes the need for additional funding, but SoCalGas maintains its forecasts, contracts, and expenditures demonstrate a genuine shortfall and that completing the project will benefit customers through improved functionality, scalability, and long-term operational reliability.
INSTANT ANALYSIS: This is a cost-overrun recovery battle. Because the CIS system supports billing and customer operations, the CPUC faces risk in denying funds if project completion or service reliability are jeopardized. The Small Business Utility Advocates settlement is a significant development (having a ratepayer advocate aligned with SoCalGas gives the CPUC political cover for full approval of the $21 million). That said, approval would still demonstrate tolerance for reopening General Rate Case funding mid-cycle for large tech projects, and the Commission may attach conditions regardless of the settlement.
INTEGRATED RESOURCE PLANNING
CalCCA provided notice of multiple recent ex parte meetings with CPUC commissioners and staff in the Integrated Resource Planning docket (R.25-06-019). In its meetings, CalCCA pressed for significant revisions to the proposed decision on 2029–2032 procurement and transmission planning portfolios, arguing the order as drafted could impose unnecessary costs and constrain load-serving entities’ ability to procure resources efficiently.
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CalCCA’s meetings focused on three core concerns:
- A requirement to procure resources for 2032 without a commitment to reassess need using updated load forecasts
- A 50% cap on the share of procurement that can be met with storage resources, which CalCCA argued is unsupported by RESOLVE modeling and could inflate costs in a seller’s market
- The absence of flexible compliance pathways that would allow load-serving entities to meet obligations cost-effectively
CalCCA recommended that the CPUC commit to reassessing 2032 needs closer to the delivery year and remove (or revise) the storage cap. It also urged the Commission to expand compliance options by extending the “good faith efforts” standard, permitting obligation trading, and carrying forward flexibility granted in prior procurement orders.
CalCCA expressed support for several elements of the proposed decision, including counting excess procurement, refraining from adopting a local procurement requirement, counting energy-only co-located resources paired with deliverable resources, and maintaining decentralized LSE procurement.
Separately, Cal Advocates disclosed a series of February 12 ex parte meetings with advisors to multiple commissioners regarding the same proposed decision.
Cal Advocates similarly sought modifications but emphasized ratepayer protections and least-cost procurement outcomes. It urged the Commission to clarify that the 50% storage cap applies only to standalone storage resources, warning that applying it broadly would force unnecessary generation procurement at higher cost.
Cal Advocates also recommended allowing load-serving entities to use the compliance flexibility mechanism from a 2025 decision (D.25-09-007) to manage project delays. Finally, it asked the Commission to reserve transmission capacity for the full 7,036 MW of modeled 2036 out-of-state wind resources (not just the 6,096 MW proposed in the PD) to prevent lower-value projects from crowding out higher-value resources supported by IRP modeling.
INSTANT ANALYSIS: Major stakeholders in the IRP docket are converging on a common theme: the current PD's procurement order is too rigid relative to uncertainty in load forecasts, project execution risk, and resource availability. CalCCA’s pushback centers on affordability and procurement feasibility, while Cal Advocates focuses on avoiding over-procurement and protecting ratepayers from inefficient resource choices.
The 2029–2032 procurement trajectory remains fluid ahead of the February 26 voting meeting, where it is scheduled for consideration on the Regular Agenda. Late revisions could modify procurement volumes, technology mix, compliance flexibility, and transmission allocations, with downstream implications for RA strategy, storage deployment, and long-term gas demand planning.
RESOURCE ADEQUACY
A new ALJ ruling in the CPUC's Resource Adequacy rulemaking (R.25-10-003) modifies the Track 1 schedule after delays in the Energy Division’s report on “transactability issues.”
The report, originally due February 6, was not completed on time due to unforeseen preparation issues and is now expected around February 23. As a result, all Track 1 deadlines specifically tied to transactability issues (such as proposals, workshops, and comments on those issues) are suspended pending a future ruling that will reset those dates once the report is released.
Other Track 1 milestones (including workshops on broader proposals and comments due March 6 and March 20) remain unchanged.
The ruling emphasizes that transactability reforms will still be addressed in Track 1 despite the delay, and a subsequent ruling will establish a revised schedule to ensure parties have adequate time to review and respond to the forthcoming report.
INSTANT ANALYSIS: The ruling delays only the transactability portion of the Resource Adequacy proceeding, indicating that reforms affecting the usability and liquidity of RA contracts are slipping while other Track 1 items continue. This extends uncertainty for 2027 procurement planning and secondary market strategy. The delay also points to unresolved disputes over how RA obligations can be traded or adjusted, making the forthcoming Energy Division report a major inflection point for load-serving entities, Community Choice Aggregators, and generators once released.