San Diego Utility to Pay $700 Million in Fire Claims

June 29, 2009

Sempra Energy’s San Diego Gas & Electric Co will pay insurers $686 million to settle claims related to wildfires that blazed through San Diego county in October 2007.

Wildfires devastated California in 2007, burning more than half a million acres from Malibu to the Mexican border, destroying more than 3,000 homes and killing 7 people in two weeks in October.

Sempra said that the wildfires that swept through San Diego county in 2007 devastated more than 200,000 acres and damaged more than 1,300 homes and two commercial properties, injuring 40 and killing 2 people.

“Today’s settlement is a pretty significant milestone in the litigation, in that we have settled with 75 percent of homeowners’ insurance companies with whom we’ve been negotiating over the last couple of months” said SDG&E spokeswoman Stephanie Donovan.

“In this settlement, we are not acknowledging any fault or liability. To the extent that our equipment was involved, it was due to the extreme weather conditions, especially the very strong Santa Ana winds that contributed to hundreds of wildfires in California in the fall of 2007”

The company continues to negotiate with the remaining insurers on similar terms, and hopes to reach a settlement in the next few weeks, Donovan added.

Sempra cited a July 2008 report by the California Department of Forestry and Fire Protection, which found two fires were caused by SDG&E power lines and a third fire was sparked when a Cox Communications fiber optic cable-lashing wire came into contact with a power line owned by the utility.

Sempra also cited a September 2008 report by the California Public Utilities Commission that said the power lines and lashing wire in question had not been properly designed.

More than 100 lawsuits have been filed against SDG&E and Sempra Energy in San Diego Superior Court seeking damages, the company said.

(Reporting by Clare Baldwin; editing by Carol Bishopric)

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