By Chris Reed.
Pacific Gas & Electric – the giant investor-owned utility that serves 16 million Californians – appears to be facing its gravest crisis since its founding in 1905.
The initial indications that PG&E’s equipment may have sparkedthe Camp Fire that killed at least 88 people in Butte County – the deadliest blaze in state history – initially led at least some state lawmakers to consider new legislation to try to insulate PG&E from potentially devastating liabilities. Earlier this year, the Legislature passed and Gov. Jerry Brown signed into law a measure that lets PG&E spread out the costs from 17 Northern California wildfires in 2017 and have its customers pay some of its bills.
The Bloomberg news service reported that Assemblyman Chris Holden, D-Pasadena, may introduce legislation to help PG&E in coming days.
But a federal judge and the president of the California Public Utilities Commission have shaken PG&E’s hopes that it can avoid crushing new blows.
Judge demands answers on PG&E, Camp Fire
U.S. District Judge William Alsup has ordered PG&E to provide evidence proving its negligence didn’t cause the Camp Fire – raising the prospect that the utility could be found guilty of violating the terms of its five-year criminal probation that began in January 2017.
The probation was imposed then by U.S. District Judge Thelton Henderson – along with the maximum possible fine of $3 million – after PG&E was convicted of six felonies related to the 2010 San Bruno disaster (pictured above). A PG&E natural gas pipeline that was found to have been poorly maintained exploded, killing eight, injuring more than 50 and wiping out 38 homes. The utility was convicted of five felonies for failing to keep the pipeline safe and a sixth felony for impeding investigators.
Judge Alsup was assigned to monitor PG&E’s probation. In a statement, Alsup said his goal was determining what “federal, state or local crimes might be implicated were any wildfire started by reckless operation or abandonment of PG&E power lines” or “inaccurate, slow or failed reporting of information about any wildfire.” If Alsup concludes that PG&E violated its probation, the utility could face unprecedented punishment from the judge.
Two days after Alsup’s announcement, CPUC President Michael Picker said he had concerns about whether PG&E’s “culture” had enough of a commitment to public safety. At a CPUC board meeting in San Francisco, the utility was orderedto implement 60 safety recommendations from a commission consultant.
Picker’s critique came less than two weeks after he stuck up for PG&E, challenging the idea that the Camp fire could or should put the utility into bankruptcy. “It’s just not good policy,” Picker told the San Francisco Chronicle. “It doesn’t work out.” This stabilized PG&E’s stock price.
The new tone from Picker was a departure from the normally close relationship between the CPUC and PG&E.
Those who have called for the CPUC to be reformed and to be much tougher with the utilities it oversees often cite the $1.6 billion “fine” the utility commission levied in 2016 on PG&E for the San Bruno disaster. More than half of the fine – $850 million – was actually a requirement that the utility upgrade its natural gas pipeline system.
Critics said this amounted to likening the improvements that PG&E had to make to a penalty.
Picker joined in the 4-0 CPUC board vote for the “fine.”