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PG&E's Future


California's governor, Gavin Newsom, is calling an emergency summit to help fix the state's largest utility, the bankrupt PG&E. In high winds, the utilities lines have accidentally started dozens of destructive and, at times, deadly fires. The company's widespread, rolling blackouts designed to prevent more fires have only increased customer anger. As NPR's Eric Westervelt reports, more lawmakers are calling for a breakup or even a state takeover of the utility.

ERIC WESTERVELT, BYLINE: To critics - and there are many - PG&E is a debt-ridden mess, a company that has grossly neglected maintaining its aging power infrastructure, soaked ratepayers, all while lavishing its executives with big bonuses and paying robust dividends to shareholders. Governor Gavin Newsom says California is now paying for a decade-plus of PG&E's greed and mismanagement.

GAVIN NEWSOM: Can these utilities figure this out and do the damn work that is long overdue to focus on modernizing their grid, undergrounding their grid and making sure that they have a grid where they can target these blackouts in a more sophisticated manner?

WESTERVELT: The company's equipment is suspected of starting at least six wildfires in the last 10 days alone, including the largest, the Kincade Fire. Its equipment, investigators say, also sparked the Camp Fire, which killed 85 people almost one year ago. Now more lawmakers want to see PG&E broken up or turned into a customer-owned utility.

DAVID RABBITT: I mean, if you look back at a picture in 1880s, you'll see a wooden telephone pole with live electrical wires strung across it.

WESTERVELT: That's Sonoma County Supervisor David Rabbitt. He's standing at the Santa Rosa command center for firefighters battling the Kincade blaze.

RABBITT: And here we are in nearly 2020, and while we carry around mini computers in our hand, in our phones, and all the other technology that we have, we still plant wooden poles in tinder-dry grass and string bare electrical wires over the top of them. That's amazing to me.

WESTERVELT: Rabbitt cautions that fixing PG&Es problems, while essential, will also be costly, time consuming, and complicated. State Senator Jerry Hill has been on a decade long crusade to reform PG&E ever since the company's natural gas lines in San Bruno killed eight of his constituents and destroyed 38 homes in 2010. The utility was convicted of six felony counts for safety negligence and obstruction, PG&E is still on probation for that disaster. Senator Hill wants federal judges overseeing PG&E, one for its probation and another now handling its bankruptcy to step in and force big changes in the name of safety.

JERRY HILL: They basically control PG&E at this moment. They should take control away from the current management and turn it over to a third party to get in there and operate this as a safe utility in the interest of the public and the rate payers in California.

WESTERVELT: If the judges don't do that, Hill argues, the state could explore other takeover options, including eminent domain. The only takeover offer currently in play is from Wall Street hedge funds through the bankruptcy court. It's not clear they would be any better on safety. Governor Newsom says he's open to exploring any option, including a state move, if it makes Californians safer.

NEWSOM: For us to take over all the assets means taking over all the liabilities and the costs. But yes, we are gaming out every scenario.

WESTERVELT: Newsom and the legislature have already taken several steps following the devastating wildfire seasons the past two years. New laws tie PG&E executive pay to safety performance and require more powerline inspections, among other measures. Asked recently about the issue, PG&E CEO Bill Johnson said a public takeover or breakup is no magic solution to the utility's challenges.

BILL JOHNSON: Regardless of eventual ownership, structure, or any of those things, these challenges don't go away. The risk doesn't go away, it doesn't get any smaller, and so however this turns out those are the things you have to focus on, mitigating that fire risk.

WESTERVELT: But the company's recent shotgun blast approach to power shutoffs, as opposed to a more surgical one, underscored to many how annoying and even dangerous that mitigation strategy is and how outdated PG&E's infrastructure is in high-tech California. Eric Westervelt, NPR News, Santa Rosa, Calif. Transcript provided by NPR, Copyright NPR.

Eric Westervelt is a San Francisco-based correspondent for NPR's National Desk. He has reported on major events for the network from wars and revolutions in the Middle East and North Africa to historic wildfires and terrorist attacks in the U.S.

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