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Unplugging PG&E Is Easier Said Than Done

1 15 0
07.11.2019

Firefighters battle the Kincade Fire in Healdsburg in October 2019.Philip Pacheco/AFP via Getty Images

As California finally takes control of the fires that have been burning for weeks, PG&E is—and will continue to be—in the hot seat. It seems likely that transmission equipment from the utility, which supplies power for roughly 40 percent of Californians, sparked the recent Kincade fire, a blaze that pushed over 180,000 people from their homes in and near Sonoma County, destroyed 374 structures, and burned almost 78,000 acres. As many as 16 fires burned across the state over the past several weeks, and at the same time PG&E was intermittently cutting power to millions of people—a practice the company’s CEO predicts will continue for another decade. Gov. Gavin Newsom declared a state of emergency and hasn’t been shy about calling out the company for it’s mismanagement and incompetence.

This has put PG&E, which filed for bankruptcy in January over its role in other recent wildfires, in the crosshairs of just about everyone—customers and legislators, as well as the governor—and state officials are looking desperately for a savior to rescue the crumbling grid and the flailing utility.

But right now, it’s really difficult to foresee what the future holds for PG&E—and more broadly for energy across California. Newsom has hinted the government, if it’s not satisfied with the pace of bankruptcy proceedings, could step in and try to take control of PG&E, but he also recently called on Warren Buffet’s Berkshire Hathaway to make a bid for the company. (Berkshire Hathaway’s energy subsidiary is deeply invested in utility companies and renewables in California and several other states.) The governor has also been open to the idea of municipalities taking over their own power management, which some of the cities themselves have echoed. At the same time, in ongoing bankruptcy proceedings, PG&E’s shareholders are fighting its bondholders, who’ve formed an alliance with fire victims, for control.

I recently called up John Geesman, an energy consultant and attorney who served as the executive director of the California Energy Commission, the state’s primary energy policy and planning agency, to try to figure out what is going on and who would even want to take on this mess. We talked about the different stakeholders involved, who might end up in charge of local power, and what the maneuverings will mean for the utility’s millions of customers. “This is a case of first impression,” he says. “The future is going to have to be invented here and invented pretty quickly.”

When we spoke last week, Geesman’s home had been without power since the weekend before, so he was staying up in the Sierras where electricity, run by a public utility district, was still flowing. Regardless of who takes over PG&E, the transition will be “extremely challenging,” he says. “Customers are going to end up paying under any scenario.”

Many have been skeptical of Newsom’s call for Berkshire Hathaway to step in and take over PG&E, which would essentially replace one form of private ownership for another. “It feels a bit like longing for a savior when there isn’t an obvious solution or a cheap solution,” bankruptcy law expert Jared Ellias told the Sacramento Bee. “There isn’t a white knight.” But Geesman thinks it might be less about a white knight and more about upping the competition. “What........

© Mother Jones