In September 2010, Cal Am Water filed an application with the CPUC requesting authorization to recover costs for the Carmel River Reroute and San Clemente Dam Removal project. The San Clemente Dam was required to be removed because it had been determined by the state to be seismically unsafe structure and the federal government had determined its presence was having an adverse effect on endangered species. Cal Am proposed to collect $138 million over 20 years from its water customers to fund the project.
In June 2012, the CPUC issued a final decision approving Cal Am’s request to charge its customers $49 million for the project with a rate of return profit for shareholders, and a soft cost cap should project costs surpass initial estimates.
DRA supports the goals of the removal of the San Clemente Dam on the Carmel River but requested that the CPUC prevent Cal Am from charging its Monterey Peninsula customers for that project due to the company's mismanagement of the dam.
In Testimony filed in May 2011, DRA argued that Cal Am shareholders – not customers – should foot the hefty bill due to the company’s imprudent handling of the sediment build-up behind the dam and failure to collect depreciation funds sufficient to cover the dam’s removal.
In response to the CPUC’s June 2012 Final Decision, DRA requested a rehearing due to the legal error in the Decision asserting that the CPUC wrongly found that Cal Am should earn a profit on an asset that no longer exists – and land that Cal Am will no longer own.
DRA is awaiting a response from the CPUC on its rehearing request.
See the proceeding docket.