SoCalGas, a major California gas utility has been fined nearly $10 million and must compensate customers for money it inappropriately spent related to the development of more energy-efficient building codes. 

The $9.8 million fine is the result of the utility continuing to engage in that work by sending workers and consultants to seminars, conference calls, and meetings related to the creation of new state and federal construction standards, according to the commission’s order on Thursday, February 3.

It’s not the first time the utility has been embroiled in controversy.


A 2015 blowout at the utility’s Aliso Canyon storage facility took almost four months to control and became the largest known natural gas leak in the nation’s history.

The utility and its parent company, Sempra Energy, settled with 35,000 plaintiffs for $1.8 billion last year.

In 2017, the Public Advocates Office found SoCalGas had been using ratepayer money to fight against the adoption of stricter building codes that would diminish the need for natural gas.

That impelled the public utility commission in 2018 to prohibit SoCalGas from using ratepayer funds on any tasks related to new building standards, irrespective of the utility’s position. It did permit them to transfer ratepayer money to other utilities working on such issues.

The Gas utility provides natural gas to nearly 22 million Californians.

The public utility commission in 2018 barred it from spending ratepayer money.

The majority of the fine is a $10,000 per day fee spread out across 960 days, from June 1, 2018, to January 15, 2021.

The judgment also restricts shareholder incentive payments related to energy efficiency schemes.

The utility showed “profound, brazen disrespect for the commission’s authority,” the commission wrote in its ruling.

Christine Detz, a spokeswoman for the utility, said in a statement that the utility was going over the decision and looked forward to “further engagement on this issue.”

The $9.8 million fine is significantly less than the $124 million penalties sought by the commission’s watchdog agency and Earthjustice, an environmental law group participating in the case.

In a statement Sara Gersen, a senior attorney for Earthjustice said: “SoCalGas has gone rogue for too long, trying to undermine California’s climate goals and keep Californians reliant on polluting gas appliances. It’s good to finally see some measure of accountability.”

This week, the utility settled another lawsuit related to the leak that alleged it violated a California law requiring businesses to warn people about possible exposure to toxic chemicals, the Los Angeles Times reported.

The agreement requires the utility to pay $1.55 million to the Center for Environmental Health, which filed the lawsuit, the state, and counsel, Detz told the Times.

The California Public Utilities Commission’s Public Advocates Office, a ratepayer watchdog group, has also accused the corporation of misusing ratepayer funds to promote the ongoing use of natural gas in buses and persuade localities not to support electric appliances in new construction.

California has set some of the most ambitious renewable energy objectives in the country, and meeting them will need phasing out the usage of natural gas.

This is already happening in several cities, which have outlawed the use of gas appliances in the new buildings.

In its most recent change to state-building rules, the California Energy Commission stopped short of forcing all new development to be all-electric.

However, the use of electric heat pumps is promoted, and new buildings, even if they utilize natural gas, must be “electric ready.”

Source: USNews

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