IS PG&E really ‘reimagined’ ?
“[I]t’s unclear there’s anything fundamentally different about the utility, which over the last decade has caused a deadly pipeline explosion, deadly fires and days-long power shut-offs affecting millions of people.”
PG&E claims they will emerge from bankruptcy as a “fundamentally improved and transformed utility,” reformed and “reimagined.” Here are five distinct issues that PG&E’s customers and regulators should consider while evaluating the utility’s claims that they’ve drastically changed and deserve to exit bankruptcy:
1. Debt
How will PG&E stay afloat - and handle the next fire or catastrophe - with their massive debt? PG&E entered bankruptcy with a debt load of $22 billion. Now the “reimagined” company is preparing to exit bankruptcy with $38 billion in debt - 73% more debt than when they entered, according to the Los Angeles Times. PG&E’s Plan is a complex house of cards, built on rosy scenarios and vague promises. It will not provide sufficient long-term financial strength or flexibility for the company—or for ratepayers.
2. Safety
After creating massive damage and suffering, is PG&E now delaying critical safety measures needed to prevent future wildfires, while seeking to hamstring the CPUC’s oversight? U.S. District Judge William Alsup, who oversees the utility’s federal criminal probation, told PG&E earlier this spring that it had “cheated on maintenance”—and ordered the company to completely overhaul its process for inspecting high-voltage power lines, hire more people to oversee the work of tree trimmers, and keep better records about the status of transmission equipment. Instead, the company proposed much more limited changes—and is threatening an appeal to a higher court. In the meantime, PG&E is announcing the likelihood of another round of planned power shutoffs across Northern California this summer.
3. Rates
Will PG&E continue to increase costs for ratepayers? PG&E has certainly “reimagined” how it names its rate hikes, passing along increased costs to customers hidden under new names, fees, and securitization. The increased debt load will only increase the likelihood of even more rate hikes for consumers—while also providing dangerous incentives for the company to do whatever it takes to overperform financially and increase profits.
4. Decentralization
Is “decentralization” just another empty buzzword for PG&E? They claim that they will “decentralize” their operations for safety and closer ties to local communities—without offering any details, or acknowledging their lackluster performance as a utility provider before they consolidated their operations decades ago. They also continue to refuse to allow communities like San Francisco to control its own power grid.
5. SF Values
If PG&E values San Francisco so much, why are they moving out of SF and refusing to accept $2.5 billion to let the city run its own power grid? PG&E claims it is motivated by what’s best for ratepayers. Well, San Francisco has the same goal—and a strong track record of providing safe, reliable, and affordable service across the city, with greater reliance on renewable energy and significantly higher levels of customer satisfaction. PG&E should respect the city’s wishes, stop its years-long practice of holding up power connections for local facilities, and allow San Francisco to operate its own local power system.