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January 02, 2020

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Paloma Ave

I agree that PG&E has been massively mismanaged since since Gordon Smith.

The rates charged seem criminal.

PG&E tried downsizing, then right sizing, then spent close to $1 billion on Accenture. All of which were massive failures.

They took a poorly run company (but somehow functioning) and broke it.

I suggest banning the board of directors from reading books that they think will fix PG&E and talk to the front-line workers.

BTW, Peter Darbee was given a $35 million severance package. Why are failures being paid to go away?

Bruce Dickinson

Folks, sometimes it takes a captain of industry, such as yours truly, Bruce Dickinson, to really shed light on the blame-game, especially when it comes to easy targets such as the "Big Bad Corporations." Guys, PG&E has made some poor decisions, but let's face it, they've been operating with one hand tied behind their back due to a major hurdle:

California's asinine regulatory and legal regime.

Let's go back to the de-regulation of wholesale power in the 1990s, which led to the power crisis of 2000-2001, resulting in the bankruptcy of PG&E and near bankruptcy of Southern California Edison and San Diego Gas & Electric. California's brilliant legislature and Public Utilities Commission allowed for de-regulation of wholesale power, but the geniuses kept retail rates capped. Thus when power shortages happened (supply and demand, weather, and also do to market manipulators such as Enron who saw the obvious weakness in the regulations as exploitation tools), all the utilities could do nothing in terms of raising rates to recoup the cost of power. Had they had this ability, this would have quickly re-balanced the market and allowed the legislature and PUC to draw up some rules that actually made sense (competition should LOWER rates) rather than force the utilities to buy extremely expensive power that was sure to bankrupt them.

Now once a company files for bankruptcy, how much money do you think it has to invest in its gas infrastructure, when retail rates are capped? PG&E and other CA utilities had some very difficult decisions to make in terms of where to allocate capital and bottom line is they didn't have enough money to do it all.

Now for the wildfire fiasco, and the reason why CA utilities seem to be the only utilities in the world that go into repeated bankruptcy: the concept of inverse condemnation. Inverse condemnation is a quirk in CA law (CA is the only State that has this genius feature that has been applied differently by the Courts vs other States), that holds utilities responsible for all potential wildfire damages from their equipment REGARDLESS of whether the companies acted with negligence.

It would make perfect sense for mismanaged, smaller companies to be taken over by larger, more financially solvent companies who have the balance sheets and resources to invest in infrastructure. Many utilities across the country have consolidated. But guess why nobody is interested in acquiring PG&E, Edison, or San Diego Gas? That's right, because they're all in California and therefore subject to potential inverse condemnation! What company in their right mind would want to own a utility that cannot raise rates for needed infrastructure and that had potentially unlimited liability in a wildfire disaster even if it acted in good faith, maintained equipment, etc, but still had to pay for an Act of God!!!???!?

Folks, what you are witnessing is the effects of a super-majority government and legislature that is nothing but an echo chamber, and stifling out any sort of creative or divergent thinking. It makes me laugh when Gavin Newsom, a successful businessman in his own right, seems to have lost all perspectives of business sense as the lure of governmental power has gone to his head...either it has clouded his thinking or he has greater aspirations beyond California and he doesn't want to do anything controversial...so best to take the easy route: Blame PG&E!

THIS is why so many businesses are leaving California.

It's really not PG&E the only one at fault. WE are responsible for this problem and WE own this!!

Joe

Well, BruceD, thanks for jumping ahead. I was planning to milk this for two or three additional posts. I'll still do it, I just have to work a little harder on it since you stole-my-line.

Joe

I will double back to more on PG&E later, but this came in today as the CA legislature opens its session:

EFFECTIVE COMMUNICATION
Lawmakers held a joint oversight hearing on Wednesday to hear how communication services failed during PG&E’s power outages last fall.

A slew of reps from emergency agencies raised frustration with not only the mass power outages, but their inability to communicate emergency messages to the Californians who also didn’t have cell phone or cable service.

Mark Ghilarducci, director of the Office of Emergency Services, said that “hundreds” of cell sites and data lines lost power during the October and November fires, creating what he called a “worst case scenario” for emergency responders.

“Many Californians were unable to communicate, get information about evacuation routes or other alerts, or receive updates on (power shutoffs) or fire conditions,” Ghilarducci said. “And 9-11 centers and hospital centers weren’t able to process critical data or leverage important records.”

Ghilarducci called for telecom companies to create better data sharing tools and harden their infrastructure, what he called a needed “public safety grid.”


Meanwhile — Three Democratic Senators — Mike McGuire of Healdsburg, Steve Glazer of Orinda and Henry Stern of Canoka Park — announced a trio of bills to mitigate the emergency communication failures.
• Senate Bill 801, which would require electrical companies to help customers on a medical baseline allowance get backup power sources.
• Senate Bill 802. which would help hospitals keep their lights on by allowing them to use diesel generators as backup power sources. (Ed: Is there a law that says they can't? If so, who passed that??)
• Senate Bill 431, which would require telecommunications companies to have at least three days of backup power during outages in fire-prone areas. (Ed: That is a LOT of diesel fuel sitting in tanks in fire-prone areas).

“Our phones have become our lifeline,” McGuire said. “(SB 431) isn’t about checking your Facebook status. This bill is about life and death.”

CTIA, an organization representing wireless companies, said that while it’s committed to ensuring that “wireless is there” when needed, the issue cannot be solved by SB 431’s “one-size-fits-all approach.”
The organization continued in an emailed statement that it will continue to “invest significantly to strengthen and harden networks”

“Networks are designed with dense, overlapping cell sites and backup solutions are employed on most wireless facilities to provide continuity of service when individual sites are inoperable,” the statement continued. “Last year’s wildfires and de-energization posed an unprecedented emergency in California, and wireless networks performed well despite the challenges. We are committed to continue working together with stakeholders and public safety officials to ensure Californians can stay connected when it matters most.”

Joe

Add another $830 million to the ratepayers' bills:

Responding to the controversial deliberate blackouts that left hundreds of thousands of Californians in the dark last fall, state regulators have approved $830 million worth of incentives to help residents and small businesses buy advanced batteries and other energy storage technologies to keep the lights on.

The incentive program, approved Thursday by the Public Utilities Commission, will be funded by ratepayers of PG&E Corp. and the state’s other investor-owned utilities.

https://www.sacbee.com/news/business/article239403298.html

PGE

All because California is the most anti-business state in the union. You guys are getting what you deserve.

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