Pacific Gas and Electric won’t face criminal charges for its role in starting several northern California fires in 2018. District attorneys in Sonoma, Napa, Humboldt and Lake counties announced that they can’t prove a case. According to a press release from Sonoma County district attorney Jill Ravitch, the necessary evidence burned up along with everything else…
The cases that were referred for prosecution all required proof that PG&E acted with criminal negligence in failing to remove dead and dying trees. Under California law, criminal negligence requires proof of actions that are reckless and incompatible with a proper regard for human life, and any charges must be proven unanimously to a jury beyond a reasonable doubt. Proving PG&E failed in their duty to remove trees was made particularly difficult in this context as the locations where the fires occurred, and where physical evidence could have been located, were decimated by the fires.
Last year, Cal Fire determined that some of the many fires that roared through California’s wine country began when trees or other vegetation came into contact with PG&E electric lines. The deadliest fire – the Tubbs fire – which killed 22 people and spread as far as city neighborhoods in Santa Rosa, was not linked to PG&E’s equipment according to Cal Fire. That one was apparently started by electric lines strung across private property by the landowners.
So far, prosecutors in other counties affected by fires linked to PG&E infrastructure have declined to charge PG&E with crimes. But that’s cold comfort. Ravitch was careful to point out that “PG&E remains on federal criminal probation and is a defendant in many private civil cases arising out of the wildfires”, including one that the County of Sonoma is pursuing. The combined liability PG&E faces from those fires as well as last year’s even deadlier Camp Fire is expected to top $30 billion. Who gets paid and how much is now in the hands of a federal bankruptcy court.
Cal Fire’s official investigation isn’t over, but Pacific Gas and Electric has concluded that it was at least partly to blame for the Camp Fire in Butte County in November, which killed 86 people. In a financial filing yesterday, PG&E laid out the evidence from the transmission tower where the fire began, and the financial consequences…
The company believes it is probable that its equipment will be determined to be an ignition point of the 2018 Camp Fire…
On November 14, 2018, the company observed a broken C-hook attached to the separated suspension insulator that had connected the suspension insulator to a tower arm, along with wear at the connection point. In addition, a flash mark was observed on Tower :27/222 near where the transposition jumper was suspended and damage to the transposition jumper and suspension insulator was identified…
Based on these facts, the company is including a $10.5 billion pre-tax charge related to third-party claims in connection with the 2018 Camp Fire in its full-year and fourth-quarter 2018 financial results…
The company has taken a total of $14.0 billion in pre-tax charges related to the 2018 Camp Fire and the 2017 Northern California wildfires to date, which reflects the lower end of the range of estimated losses the company faces from such wildfires. The charges represent a portion of the previously announced estimate of potential wildfire liabilities, which could exceed more than $30 billion.
The bottom line: PG&E’s management and auditors believe there is “substantial doubt” about its and its parent corporation’s “ability to continue as going concerns”.
If indeed there is evidence that PG&E was negligent, or even simply made poor choices, the company faces a triple whammy. It’ll be blood in the water for the predatory bar, which no doubt expects to get the shark’s share of $30 billion plus, and it’s sure to test, if not break completely, the patience of the federal judge who is supervising PG&E probation, which stems from an earlier criminal conviction for deadly safety lapses.
Pacific Gas and Electric will cut off electricity more automatically, more thoroughly and over a wider area when “extreme fire risk conditions” are present. That’s one of the wildfire risk mitigation measures it promises to implement this year.
Along with five other privately owned Californian electric utilities, PG&E submitted its wildfire prevention plan to the California Public Utilities Commission yesterday. It says it will inspect more lines, cut down more trees and harden more equipment in the coming months and years, as well as aggressively turning off power when the threat of wildfires is high. The proactive power cuts will be greatly expanded, to include…
25,200 miles of low voltage distribution lines, up from 7,100 miles.
5,500 miles of transmission lines, up from 370 miles. Instead of limiting it to lines carrying 70 kilovolts or less, lines of up to 500 kilovolts will be cut off if necessary.
Potentially 5.4 million customer premises, up from 570,000 customers.
Areas that face an “elevated” fire threat, in addition to those that face an “extreme” one.
PG&E also says it will streamline “decision criteria to reduce the level of judgment in the criteria to the extent feasible”. In other words, reduce the opportunity for managers to dither over whether or not to cut power.
One result is predictable and entirely acceptable: more PG&E customers will complain because their power is off. That happened last year, when PG&E proactively cut power in some northern California communities in October. It’s not a huge leap of logic to suppose that the backlash made managers more reluctant to turn off the juice in November. High winds and dry conditions were present once again, and led to the Camp Fire in Butte County, which killed 86 people and destroyed the town of Paradise.
A PG&E transmission line is suspected of sparking that fire. Under the new plan, it could have been turned off – it was in a high risk area, conditions were extreme, and it was 110 kilovolts (within the new limit but over the old one) – and probably would have been if the decision had been based on automatic criteria rather than a subjective judgement call.
The plan will be reviewed by the CPUC and by the federal judge that’s supervising PG&E criminal probation. Judge William Alsup has been sharply critical of PG&E and suggested it should do many of the things proposed in the plan, although not all his suggestions were included in it.
The wildfire prevention plan notwithstanding, yesterday was not a good day for PG&E. A natural gas line exploded in San Francisco and set several buildings on fire. There were no reports of injuries. It was apparently caused when a fiber optic construction crew hit a gas line. Whenever underground construction work is done, the contractor is supposed to notify PG&E and other utilities, which are then responsible for coming out and marking where their lines are. That’s a job that PG&E is accused of shirking in the past by the CPUC. Responsibility for yesterday’s blast is yet to be determined.
A federal judge lambasted Pacific Gas and Electric’s and the California Public Utilities Commission’s wildfire prevention efforts, and the California supreme court allowed a key wildfire cost sharing decision by the CPUC to stand yesterday. That follows PG&E’s bankruptcy filing on Tuesday.
Judge William Alsup is PG&E’s probation officer. The corporation was convicted of criminal misconduct following a deadly natural gas line explosion in San Bruno in 2010, and it is accountable to Alsup for how well it’s complying with the penalties handed down, which include good behavior requirements. Alsup thinks PG&E is a danger to the public, and he doesn’t have a high opinion of the CPUC’s efforts to rein it in. According to a story in the San Jose Mercury News by Matthias Gafni and John Woolfolk, representatives from both PG&E and the CPUC tried to convince Alsup that his proposal to require PG&E to inspect more than 100,000 miles of electric lines before this summer’s fire season begins is a bad idea. He wasn’t buying any of it…
“Does a judge turn a blind eye and let PG&E continue what you’re doing, let you keep killing people?” U.S. District Judge William Alsup said inside the San Francisco courtroom. “Can’t we have electricity that is delivered safely in this state?”…
The judge also questioned the California Public Utilities Commission, the state agency charged with regulating PG&E and other investor-owned utilities.
“How did it happen so many fires occurred under your regulations?” Alsup asked a representative of the state regulator. “It sounds harsh, but that’s what the people of California deserve to know, how did that happen?”
After three intense hours, Alsup told the parties he would rule later, but the state of California did not have time to waste with another fire season approaching.
Alsup hinted he might require PG&E to use the same, aggressive power cutting tactics that San Diego Gas and Electric uses when wildfire danger is high. SDG&E began proactively de-energising lines after wildfires in 2007 that it and Cox Communications were responsible for starting.
Pacific Gas and Electric filed for bankruptcy protection yesterday, beginning a process that could lead to significant changes in how electricity and natural gas service is delivered in northern California, and how much it costs. It also has the potential for changing the cost sharing calculations that determine how much telecoms companies pay to share poles and conduit with PG&E.
As part of the filings, PG&E also filed various motions with the Court in support of its reorganization, including requesting authorization to continue paying employee wages and providing healthcare and other benefits. In the filings, PG&E also asked for authority to continue existing customer programs, including low income support, energy efficiency and other programs supporting customer adoption of clean energy. PG&E expects the Court to act on these requests in the coming days.
Translation: if you work for us, don’t make assumptions about your paycheck or benefits package for the time being, and if you’re relying on rents extracted by the CPUC or California legislature, make contingency plans.
It’s not time to push the panic button – an experienced bankruptcy judge won’t start slashing and burning – but it isn’t the time to rely on old certainties either. A new U.S. marshal just rode into town, and hasn’t decided whether the local sheriff is the solution or the problem.
Monday, in an emergency meeting held amidst a crowd of raucous protestors, the CPUC gave PG&E permission to borrow more money, which it will have to do to pay for operations during the bankruptcy proceedings – so called debtor in possession financing.
The CPUC also filed a brief with the federal judge overseeing PG&E compliance with criminal sanctions resulting from the deadly San Bruno natural gas explosion in 2010. According to Politico, the CPUC objected to a hugely expensive electric line inspection throughout PG&E’s territory proposed by judge William Alsup, arguing “the proposal interferes with their oversight and would endanger public safety”. It’s arguable whether Alsup’s idea would help or hinder public safety, but there’s no question that it shoves the CPUC aside. Which might be why he’s proposing it: CPUC oversight did not prevent the San Bruno explosion or the Camp Fire or any of the other fires, deadly or otherwise, that PG&E is implicated in.
The future of northern California’s energy supply, and the utility pole routes that support it, will be largely in the hands of federal judges. Pacific Gas and Electric gave notice yesterday that it will, in all likelihood, file for bankruptcy protection in two weeks. The company said that it may have to pay as much as $30 billion in damages stemming from catastrophic wildfires it apparently played a role in starting in 2017 and 2018. That’s about three times more than the company was worth before its stock price nosedived on the news. A federal bankruptcy court will have to decide how to carve up whatever is available, and who gets control of the carcass.
Another federal judge is assuming an oversight role that, in theory, the California Public Utilities Commission is supposed to fill. Last week, judge William Alsup gave PG&E until the end of the month to come up with a plan for inspecting the more than 100,000 miles of electric lines it operates in California before the next fire season begins in June. He’s essentially PG&E’s probation officer, following the corporation’s of criminal conviction related to a natural gas line explosion in San Bruno in 2010.
So far, the CPUC hasn’t made any comment about PG&E bankruptcy plans or Alsup’s encroachment on its turf. Last month, CPUC president Michael Picker launched an investigation that could result in PG&E break up, or a takeover by the state, or any number of other fates. Or could have, before financial markets, trial lawyers and the federal judiciary got tired of waiting. At the time, Picker stated in a press release that “this process will be like repairing a jetliner while it’s in flight. Crashing a plane to make it safer isn’t good for the passengers”.
Yesterday, PG&E said the plane is going down. All we passengers can do is assume the position, and hope for the best.
With liabilities from California wildfires amounting to unknown billions of dollars, Pacific Gas and Electric company announced this morning that it plans to file for bankruptcy as soon as it’s legally able to do so. According to a company press release…
The Company today provided the 15-day advance notice required by recently enacted California law that it and its wholly owned subsidiary Pacific Gas and Electric Company (the “Utility”) currently intend to file petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code on or about January 29, 2019.
Governor Gavin Newsom released a statement saying he’s been engaged with the problem over the weekend…
The company should continue to honor promises made to energy suppliers and to our community. Throughout the months ahead, I will be working with the Legislature and all stakeholders on a solution that ensures consumers have access to safe, affordable and reliable service, fire victims are treated fairly, and California can continue to make progress toward our climate goals.
No reaction yet from the California Public Utilities Commission.
Pacific Gas and Electric could be broken up, reorganised or brought under closer control by the California Public Utilities Commission. The decision to launch a broad investigation into PG&E’s future, including the possibility of a public takeover, was made by commission president Michael Picker and released late on Friday, after financial markets had closed and the holiday exodus had begun.
Radical action of this sort, taken against a major utility, is cause for concern by telecoms companies too. Generally, it signals a change to much more aggressive utility regulatory regime in California. Specifically, it increases the threat of future criminal and civil liability, affects management of and access to utility poles and conduit, and puts a major source of independent dark fiber in jeopardy.
All that, just within the past two months. In his decision, Picker said standard remedies aren’t working…
This Commission was, and remains, concerned that the safety problems being experienced by PG&E were not just one-off situations or bad luck, but indicated a deeper and more systemic problem. The fact that imposing penalties on PG&E (the Commission’s standard tool for addressing safety problems) did not seem to change the situation reinforced this concern…
The next phase of this proceeding will consider a broad range of alternatives to current management and operational structures for providing electric and natural gas in Northern California.
Options under consideration include various methods of bringing PG&E’s executives and board of directors under tighter CPUC control, or replacing them altogether, breaking the company up into smaller pieces, on a business line and/or regional basis, and taking over the company and turning it into a publicly owned utility of one kind or another.
Picker’s decision – technically, a “scoping memo and ruling” – comes in an investigation that began in 2015. It’s just another step, albeit in a new direction, in a process that will grind on for many more years.
Turning off electric power lines in dry, windy conditions is one way to reduce the risk of catastrophic wildfires. The California Public Utilities Commission is about to start the wheels turning on an investigation into how and when that should be done. Optimistically, the draft order instituting rulemaking predicts that it’ll be wrapped up sometime next summer.
Last summer, the CPUC allowed Pacific Gas and Electric, Southern California Edison and a handful of smaller “investor owned” electric utilities to do the same kind of proactive de-energisation that San Diego Gas and Electric has been allowed to do since 2008. It’s too early to conclude whether their subsequent efforts did any good, but the hazy picture we have now indicates that there is considerable room for improvement, by utilities and their customers:
SCE made proactive power cuts to a few dozen homes, but not in the Woolsey Fire area. Lines that weren’t de-energised might have been the cause; at least three customers burned to death.
As it’s been doing for several years, SDG&E shut off power to 24,000 homes in November, ahead of the same winds that drove the Camp and Woolsey fires. No wildfires started; no customers burned to death, no complaints were reported.
Turning power off is relatively simple. Turning it back on is not. Lines have to be inspected first, and re-energising has to be done systematically and carefully. Even absent nimby whining, it’s not something to be done casually. But there is a clear contrast between the decisions made by PG&E and SCE ahead of the Camp and Woolsey fires, and the actions taken by SDG&E.
At least 71 people are dead, more than a thousand are missing, and the fight to contain the Camp Fire in Butte County continues. As dense smoke settled over its San Francisco headquarters, the California Public Utilities Commission said it will take a hard look at Pacific Gas and Electric, which might have been responsible for starting it.
PG&E isn’t offering any details – or speculation – about what this second report might mean. It’s only saying “Cal Fire has collected PG&E equipment on that circuit” and “secured a location” nearby. All Cal Fire has said about the cause of the Camp Fire is that it’s “under investigation”.
Concow is between Pulga and Paradise. Until now, the publicly available information indicated that the fire started east of Pulga, where it was first reported, then moved west into Pulga, through Concow and then into Paradise. A story in the Chico Enterprise Record earlier this week told of how a zone by zone evacuation plan – previously rehearsed by Paradise officials – was pushed beyond the breaking point by the speed of the blaze. This latest report from PG&E raises the possibility that a second ignition point flared up closer to Paradise, taking everyone by surprise.
At this point it’s just my own speculation. But if something like that happened – two fires beginning so close together, from similar causes – it raises even more questions about how this kind of disaster can be prevented in the future.
CPUC president Michael Picker said in a press release “in the existing PG&E safety culture investigation proceeding, I will open a new phase examining the corporate governance, structure, and operation of PG&E, including in light of the recent wildfires”. He also said that the commission will begin implementing senate bill 901, which was passed by the California legislature earlier this year and allows electric utilities to pass some of the costs associated with wildfire liability on to customers.
The physical damage toll will be in the billions of dollars, beyond the limit of PG&E’s insurance coverage and, maybe, beyond its ability to pay under normal circumstances. Bankruptcy is a possibility, if PG&E is even partly to blame and the CPUC doesn’t offer a sufficient bail out.
Southern California Edison also faces the possibility of a multi-billion dollar damage bill from the Woolsey and Hill fires, which ripped through parts of Ventura and Los Angeles counties. One of its high voltage lines was near the Woolsey Fire’s point of origin, although the cause is yet to be determined as well.
Long term, there are many ideas floating around for reducing the risk of wildfires in California. But for now – for today – the only thing electric utilities can do is turn off power to high risk lines ahead of high wind forecasts.
SCE didn’t proactively shut down any lines before the fires began, but did shut off a total of 85 customers in scattered locations as high winds continued. All were back on line by Wednesday. PG&E warned it might cut off power in Butte and either other northern California counties ahead of the Camp Fire, but did not do so and stopped issuing alerts more than a week ago.