California PUC issues restraining order against SoCal, PG&E

In an emergency meeting Friday, the California Public Utilities Commission issued a temporary restraining order preventing Pacific Gas & Electric Co. and Southern California Edison Co. from refusing to provide electricity under "obligation to serve" laws.

Commission Pres. Loretta Lynch said the agency became concerned recent actions by the two utilities could undermine their service obligation. She said the commission learned Thursday the utilities stated to the Electricity Oversight Board and the California Independent System Operator (ISO) they would not schedule service except to those customers they could serve with power from their own generating plants.

This could mean that Southern California Edison (SCE), a unit of Edison International, and Pacific Gas & Electric, a unit of PG&E Corp., would provide service through the ISO only with the electricity their own power plants generate and thus would not serve a significant portion of their customers, Lynch said.

She conceded neither Edison nor Pacific Gas & Electric had formally officially "notified this commission of any change in utility operations," adding the PUC was acting with an abundance of caution.

Edison International CEO John Bryson called the PUC order forbidding SCE from withdrawing from its obligation to serve "an insult to the ethic of the 13,000 employees of SCE" and "an abuse of their powers."

He said Edison has no intention of unilaterally withdrawing from its obligation and that he made that clear to Lynch in a Thursday phone conversation and subsequently reiterated it in another call to Lynch Friday.

Nonetheless, during a Jan. 4 hearing before the PUC, Henry Weismann, an attorney representing the utility asked the commission "to relieve Southern California Edison of the obligation to serve" customers under California law.

"This will mean someone else�perhaps the state�will have to assume responsibility of procuring power in our service territory," he said, after the commission turned down a rate increase the company was proposing.

But Bryson said SCE has repeatedly affirmed its commitment to provide continuing service to its customers and has also repeatedly urged the PUC to recognize its corollary obligation to allow SCE to recover the costs of providing that service. He noted SCE has borrowed billions of dollars, which threatens the company's solvency, in order to continue to serve.

In a statement, Lynch said a bankruptcy filing or the threat of insolvency has no bearing on the obligation to serve because utilities that file for reorganization must continue to serve their customers.