CPUC launches long-term undergrounding initiative for utilities

The California Public Utilities Commission (CPUC) established a long-term electric distribution Undergrounding Program for large investor-owned utilities (IOUs) in the state.

The initiative is designed to create a structured and expedited process for utilities, such as Pacific Gas and Electric Company, Southern California Edison, and San Diego Gas & Electric, to submit comprehensive 10-year undergrounding plans to the Office of Energy Infrastructure Safety and CPUC for review. Further, it will create an opportunity to facilitate system hardening, achieve economies of scale, and drive down costs.

The program involves a two-phase approval process for utilities, followed by a construction and monitoring phase.

In phase one, a utility submits a 10-year undergrounding plan to the Office of Energy Infrastructure Safety (Energy safety), identifies undergrounding projects that will be constructed as part of the program. Energy Safety then reviews the plan, assessing its potential to enhance reliability and mitigate wildfire risk. Within nine months of its submittal Energy Safety approves or denies the plan.

If Energy Safety approves the plan, phase two begins. At that point, the utility files an application with the CPUC for conditional approval of the plan’s costs. The utility is required to compare the costs and benefits of undergrounding to alternative system hardening and risk mitigation measures. CPUC has up to nine months to review and conditionally approve or deny the costs associated with any plan. Ultimately, if CPUC approves it, construction can begin with regulatory oversight and periodic audits.

The plan was developed in response to direction from the state legislature through Senate Bill (SB) 884, which calls for a similar type of program.

“Today the CPUC adopts guidelines, pursuant to Senate Bill 884, for an Expedited Undergrounding Program,” Commissioner Darcie Houck said. “This Program creates a process for expedited undergrounding of electric utility distribution infrastructure in high wildfire threat areas to further the state’s goals of decreasing wildfire risk and increasing grid reliability, while also incorporating oversight and ratepayer protection measures.”

This initiative is the result of extensive stakeholder engagement, including feedback received through a public workshop, a staff proposal, and multiple rounds of public comments. Through this collaborative approach, the CPUC aimed to incorporate diverse perspectives and strengthen transparency and inclusivity of the program.

“This decision continues our critical work of driving down wildfire risk for utilities. It comes only a few months after our decision in PG&E’s General Rate Case where we found that increased investments in hardening the grid would provide great value to Californians,” Commissioner John Reynolds said. “The rules adopted today build on those investments, ensuring that long-term undergrounding promotes a safer grid in the most cost-effective way. Implementing SB 884 as we plan to do will greatly reduce wildfire risk and includes a number of key consumer protections to ensure that each dollar is wisely spent.”