Federal Funds Would Support the Strategic Undergrounding and Overhead Hardening of Power Lines around Tribal Lands
SAN DIEGO, April 7, 2023 – As part of its commitment to reduce the impact of infrastructure costs on electric rates, this week, San Diego Gas & Electric (SDG&E) submitted an application to the United States Department of Energy (DOE) seeking up to $100 million in federal funds through the Grid Resilience and Innovation Partnerships Grant program, which is part of the federal Infrastructure Investment and Jobs Act (IIJA). If awarded, the grant would help offset the costs of wildfire hardening efforts on and around federally recognized Tribal Nations’ land within SDG&E’s service territory. Pending final approval from the California Public Utilities Commission (CPUC), the federal funds would be matched with an additional $100 million from SDG&E.
“Our region has the most federally recognized Tribes of any county in the nation, and all are located in areas facing the highest risk for wildfire. These funds would help us continue to work with Tribes to provide safe and resilient energy in the face of a changing climate,” said Caroline Winn, CEO of SDG&E. “If approved, this grant would not only help advance wildfire safety initiatives planned on Tribal lands which have experienced wildfires and Public Safety Power Shutoffs in the past, but also plays a key role in in our strategy to reduce energy costs for customers.”
As the company prioritizes strategic undergrounding of more power lines, the grant would help SDG&E leverage a good portion of its existing and planned fire hardening efforts over the next three years across the majority of Tribal Nations the company serves. The funding would further the company’s efforts to strengthen its energy infrastructure and create communities that are safer, stronger and healthier by hardening approximately 70 miles of SDG&E’s electric grid. This includes undergrounding approximately 64 miles of power line and covering 6 miles of line with covered conductor, benefiting up to 10 of the region’s Tribal communities.
Seeking state and federal funds to pay for climate adaptation measures is an important element of SDG&E’s four-part strategy to lessen the financial burden and improve affordability for customers which also includes:
- Pursuing additional federal funds available by maximizing federal tax credits for battery storage and microgrid facilities that can be refunded to customers;
- Advocating for legislation (AB 982) to remove costs from electric rates that could reduce monthly bills up to 7% and legislation to spread the cost of wildfire safety improvements over a longer period of time to reduce rate impacts;
- Modernizing the way electricity is priced; and
- Stabilizing natural gas bills by advocating for improved utilization of existing infrastructure.
SDG&E submitted its application this week and anticipates receiving outcome notification from the DOE this summer. Prior to acceptance of any grant that is awarded, SDG&E will also need to receive CPUC approval. Then construction would take place between 2024 and 2026. If the grant application is denied, the company still plans to move forward with the fire hardening projects pending approval from the CPUC.
SDG&E is an innovative San Diego-based energy company that provides clean, safe and reliable energy to better the lives of the people it serves in San Diego and southern Orange counties. The company is committed to creating a sustainable future by providing its electricity from renewable sources; modernizing natural gas pipelines; accelerating the adoption of electric vehicles; supporting numerous non-profit partners; and, investing in innovative technologies to ensure the reliable operation of the region’s infrastructure for generations to come. SDG&E is a subsidiary of Sempra Energy (NYSE: SRE). For more information, visit SDGEnews.com or connect with SDG&E on Twitter (@SDGE), Instagram (@SDGE) and Facebook.
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Factors, among others, that could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement include risks and uncertainties relating to: California wildfires, including that we may be found liable for damages regardless of fault and that we may not be able to recover all or a substantial portion of costs from insurance, the wildfire fund established by California Assembly Bill 1054, rates from customers or a combination thereof; decisions, investigations, inquiries, regulations, issuances or revocations of permits or other authorizations, renewals of franchises, and other actions by (i) the California Public Utilities Commission (CPUC), U.S. Department of Energy, U.S. Federal Energy Regulatory Commission, and other governmental and regulatory bodies and (ii) the U.S. and states, counties, cities and other jurisdictions therein in which we do business; the success of business development efforts and construction projects, including risks in (i) completing construction projects or other transactions on schedule and budget, (ii) realizing anticipated benefits from any of these efforts if completed, and (iii) obtaining the consent or approval of partners or other third parties, including governmental and regulatory bodies; litigation, arbitrations and other proceedings, and changes to laws and regulations; cybersecurity threats, including by state and state-sponsored actors, of ransomware or other attacks on our systems or the systems of third-parties with which we conduct business, including the energy grid or other energy infrastructure, all of which have become more pronounced due to recent geopolitical events, such as the war in Ukraine; our ability to borrow money on favorable terms and meet our debt service obligations, including due to (i) actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook or (ii) rising interest rates and inflation; failure of our counterparties to honor their contracts and commitments; the impact on affordability of our customer rates and our cost of capital and on our ability to pass through higher costs to current and future customers due to (i) volatility in inflation, interest rates and commodity prices, (ii) the cost of the energy transition in California, and (iii) departing retail load resulting from additional customers transferring to Community Choice Aggregation and Direct Access; the impact of climate and sustainability policies, laws, rules disclosures, and trends, including actions to reduce or eliminate reliance on natural gas, increased uncertainty in the political or regulatory environment for California natural gas distribution companies and the risk of nonrecovery for stranded assets; our ability to incorporate new technologies into our business, including those designed to support governmental and private party energy and climate goals; weather, natural disasters, pandemics, accidents, equipment failures, explosions, terrorism, information system outages or other events that disrupt our operations, damage our facilities or systems, cause the release of harmful materials, cause fires or subject us to liability for damages, fines and penalties, some of which may not be recoverable through regulatory mechanisms, may be disputed or not covered by insurers, or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power, natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid, pipeline system or limitations on the withdrawal of natural gas from storage facilities; changes in tax and trade policies, laws and regulations, including tariffs, revisions to international trade agreements and sanctions, such as those that have been imposed and that may be imposed in the future in connection with the war in Ukraine, which may increase our costs, reduce our competitiveness, impact our ability to do business with certain counterparties, or impair our ability to resolve trade disputes; and other uncertainties, some of which are difficult to predict and beyond our control.
These risks and uncertainties are further discussed in the reports that the company has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC’s website, www.sec.gov, and on Sempra’s website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.
Sempra Infrastructure, Sempra Infrastructure Partners, Sempra Texas, Sempra Texas Utilities, Oncor Electric Delivery Company LLC (Oncor) and Infraestructura Energética Nova, S.A.P.I. de C.V. (IEnova) are not the same companies as the California utilities, San Diego Gas & Electric Company or Southern California Gas Company, and Sempra Infrastructure, Sempra Infrastructure Partners, Sempra Texas, Sempra Texas Utilities, Oncor and IEnova are not regulated by the CPUC.