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PSC approves six-month emergency rider for South Coast Gas to avoid default
Summary
The Commission approved a six-month interim surcharge to raise about $952,000 to satisfy a bank demand and avoid default for South Coast Gas, after staff testimony that the company suffered substantial customer losses post‑Hurricane Ida and faces unusual short-term liquidity needs.
The Commission approved an amendment to South Coast Gas Company’s interim cost‑recovery rider to raise roughly $952,000 over six months so the company could satisfy a bank demand and avoid default.
Staff explained the company experienced a severe drop in gas sales after Hurricane Ida (losing roughly 850 customers at one point and remaining down about 400 customers compared with pre‑storm levels) and had grown short‑term credit needs. The bank holding a line of credit demanded full liquidation by November unless the company refinanced. Company- and staff-witnesses said the requested rider, collected April–September, will pay down the immediate short-term debt and allow the company to pursue refinancing and other lender arrangements.
Commissioners and staff asked specific questions about the magnitude and duration of the surcharge and about customer notification. Staff said the interim rider would be an adder on bills for six months and that the company will send notice cards to customers apprising them of the change.
The Commission approved the motion after hearing that the company had taken internal cost-cutting steps (board fee reductions, limited salary increases) and that staff judged the company to be well-run but in an abnormal cashflow situation. Commissioners and staff emphasized the action was targeted and temporary: the amendment will expire after the six-month collection period.
