The California Public Utilities Commission received a request from San Diego Gas & Electric Co. for a hike in the company’s overall rate of return on April 22.
SDG&E said the request to increase its return on capital to 10.03 percent includes requests for an increase on its return on equity to 14.3 percent. SDG&E said the proposal accounts for the increased wildfire risks and liabilities in the state.
“Updating the return on equity will ensure the company can continue to attract investors to help build and improve the region’s clean, safe and reliable energy grid,” SDG&E said in a statement.
The commission last modified SDG&E’s return on equity to 10.20 percent in April 2017. The move from CPUC came three years after the commission authorized a rate of return of 7.79 percent, and a 10.3 return on equity with a 5 percent long-term debt cost and a preferred stock cost of 6.22 percent.
The modification granted in 2017 reset the costs of long-term debt and preferred stock in 2018.
SDG&E’s request, if approved, would be enacted in 2020 and run through 2022.
SDG&E is a unit of Sempra Energy, whose stock trades on the New York Stock Exchange under the symbol SRE.