The heart of their dispute is that Crown Castle wants to buy attachment space on poles, and PG&E just wants to lease it to them. Incumbent telecoms companies, like AT&T, can buy space, but they have to buy all of the communications zone, which is section of the pole, typically three or four vertical feet, that’s suitable for attaching telecoms cables. Once they buy the whole zone, they’re then responsible for leasing out attachment space by the foot to competitive telecoms companies like Crown Castle.
Crown Castle isn’t interested becoming the telecoms landlord on PG&E poles, and there’s some doubt as to whether CPUC rules allow them to do it in the first place. The ALJ heard both sides arguments, as well as comments from other interested comments, and decided that there’s nothing in the CPUC rules that says PG&E has to sell pole attachment space by the foot.
So now Crown Castle is telling the ALJ that 1. commissioners should disregard her ruling and give it what it wants anyway, and 2. if they don’t do that, they should change PG&E’s standard pole space leasing agreement to, among things, create a 45 day shot clock for PG&E to approve or reject a request to attach to a particular pole. If PG&E has “provided no response” within that time, Crown Castle could attach its fiber at will. It also wants to know when other companies ask to lease any remaining space, wants to be able to work on poles without notifying PG&E and doesn’t want PG&E to rearrange any of its cables without its permission. Which add up to many of the privileges that come with pole space ownership, without the responsibility of managing leases with other telecoms companies.
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.
Utility pole associations, which manage joint use of poles by electric utilities – privately and municipally owned – and telecoms companies of all sorts, should be regulated by the California Public Utilities Commission, according to a ruling by an administrative law judge (ALJ). The ruling focuses on a narrow dispute between two companies: big picture, it’s little more than advice to CPUC commissioners. But it’s bad advice.
The ruling concerns a dispute between Pacific Gas and Electric, which owns poles throughout northern California, and Crown Castle, which is an independent, competitive telecoms company that owns and leases fiber routes, and builds and operates cell sites. PG&E offered to lease space to Crown Castle on its poles, as it’s required to do by the CPUC. Crown Castle said it would prefer to buy outright a foot’s worth of space on PG&E’s poles, so it can get about its business of building fiber networks without worrying about keeping a landlord happy. AT&T, and other incumbent telephone companies, buy space on PG&E’s poles, but they buy the whole communications zone, which can be several feet of pole space. They are then responsible for leasing out attachment space by the foot to independent companies like Crown Castle, also as required by the CPUC.
Crown Castle didn’t want to pay for and be responsible for the entire communications zone on PG&E poles, and if they did, it’s not entirely clear that they would have the same obligation as AT&T and other incumbents to lease space to other telecoms companies. So Crown Castle and PG&E ended up in a stalemate. To resolve it, Crown Castle asked the CPUC to step in and arbitrate the dispute. The ruling issued yesterday by ALJ Patricia Miles says that PG&E is meeting its obligations by offering to lease attachment space on poles and Crown Castle has no particular right to buy it by the foot.
But the ruling goes one step further and says that procedures and contracts developed by joint pole associations – the Northern California Joint Pole Association (NCJPA) and the Southern California Joint Pole Committee – need to be approved in advance by the CPUC…
There can be no doubt that disputes such as the present one will arise again. For this reason, if NCJPA is going to continue to facilitate sale and purchase transactions pertaining to public utility poles among its member entities, the Commission should require NCJPA to submit (before implementation) for Commission review and approval…its agreements, forms, procedures and handbooks which concern the transfer, sale, lease, assignment, mortgage, or encumbrance of public utility poles. Such transactions, which are being handled by NCJPA on behalf of its members, are clearly within the Commission’s jurisdiction.
The ALJ’s report amounts to a suggestion for commissioners, who would have issue a formal decision requiring joint pole associations to get advance approval for pole attachment deal terms. If commissioners go down that road, it will be a lengthy and contentious process. Not all utilities that own and/or attach to poles are under CPUC jurisdiction. An association of municipal electric utilities objected to a draft version of the ALJ’s ruling, pointing out that the CPUC has no authority over them and shouldn’t try to tell them how to manage their own poles.
In the meantime, the ALJ’s ruling will be widely read and could influence similar one-on-one disputes between independent telecoms companies and electric utilities.
Yesterday’s ruling affirmed PG&E’s current practice, and in that regard offered a bit of clarity to the already horribly complex problem of how utility pole routes are shared and managed in California. But by threatening to extend CPUC oversight to joint pole associations, the ruling adds an unneeded and unwelcome layer of uncertainty.
The CPUC has ongoing proceedings that involve a number of issues related to pole access and, because of PG&E’s bankruptcy filing and past criminal conviction, federal judges will have a lot to say about it. The California legislature and civil courts are also involved because of the dozens of deaths and billions of dollars worth of damaged caused by fires started by electric lines. Now is not the time to drag even more players into this mess.
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.
It has come to our attention that certain individuals at the FCC may have urged companies to challenge the Order the Commission adopted in order to game the judicial lottery procedure and intimated the agency would look unfavorably towards entities that were not helpful. If true, it would be inappropriate for the FCC to leverage its power as a regulator to influence regulated companies to further its agenda in seeking a more friendly court. To date, four FCC licensees have petitioned the federal judiciary for review of the Order in separate filings and in separate circuits.
Whether or not the four mobile carriers colluded with friends at the FCC to find a friendly court, in the end it didn’t matter. The City of San Jose completed a legal Hail Mary pass and got the all the cases sent to the ninth circuit federal appeals court in San Francisco, which tends to take a more skeptical view of FCC authority.
The mobile companies, which claim the FCC committed a grievous error by not giving them the pink slip along with the keys to the city, are still in a position to disrupt the appeals launched and joined by dozens of cities, counties and associations from every corner of the U.S. To head that off, local governments are asking the ninth circuit to hold a “case management conference”…
Because this case involves appeals by representatives of industry (which argue that the agency did not go far enough in adopting remedies sought by industry) and representatives of local governments and organizations (which argue the FCC’s actions significantly exceeded the agency’s authority), there is also likely to be a more complex pattern of briefs filed in support of, and in opposition to the FCC’s Order than is reflected in a typical agency appeal.
Right now, nine cases – three filed by mobile carriers and six by local governments – are in the San Francisco court, with four more – one by AT&T and three by local governments – apparently inbound from the federal appeals court in Washington, D.C.
PG&E might be out of the chain of liability for the deadly October 2017 Tubbs fire, which swept through 37,000 acres in Napa and Sonoma counties, burning exurban estates and Santa Rosa tract homes alike. Cal Fire released a report yesterday that points the finger of blame at household electrical equipment on private property.
The lead investigator, Cal Fire battalion chief John Martinez, concluded “during my investigation, I eliminated all other causes for the Tubbs Fire, with the exception of an electrical caused fire originating from an unknown event affecting privately owned conductor or equipment”. In other words, PG&E was not to blame and, assuming Cal Fire’s conclusion are taken as authoritative by courts (quite possible) and the predatory bar (yeah, right), won’t be liable for the 22 deaths or the billions of dollars of damage resulting from the Tubbs fire.
(The full report contains vignettes of trial lawyers beaming in with alleged proof, complete with powerpoint presentations, of who was responsible. None were even close.)
PG&E still faces extensive litigation, significant potential liabilities and a deteriorating financial situation, which was further impaired by the recent credit agency downgrades to below investment grade. Resolving the legal liabilities and financial challenges stemming from the 2017 and 2018 wildfires will be enormously complex and will require us to address multiple stakeholder interests, including thousands of wildfire victims and others who have already made claims and likely thousands of others we expect to make claims.
The 2018 Camp fire was even more deadly and destructive, and both initial and follow up reports, by PG&E and others, point more directly at the company. But Cal Fire has reached no conclusions and its investigation continues.
The challenge to the Federal Communications Commission’s September Order preempting local ownership and control of municipal property grinds on. The local governments and companies appealing the order, which strips cities and counties of ownership rights to streetlight poles and other such assets in the public right of way, filed brief statements –mediation questionnaires – with the San Francisco-based federal appeals court hearing the case yesterday.
Mobile companies are appealing the order because, they say, the FCC didn’t go far enough and give them everything they wanted. It would be overly optimistic to say the likelihood of the courts agreeing with them is slim. But by filing their appeals, they get a seat at the table so they can, presumably, disrupt the cases brought by local governments.
In its questionnaire, Verizon repeated its amazing argument that the FCC isn’t allowed to not automatically allow it to attach wireless equipment to city poles if the review process takes too long – in other words, if the “shot clocks” expire…
In the underlying Order, the FCC considered state and local regulatory barriers to the wireless infrastructure siting review process, particularly the siting of next-generation infrastructure. The FCC’s refusal to implement the “deemed granted” remedy is arbitrary and capricious in violation of the Administrative Procedure Act, and is an abuse of the Commission’s discretion. It also violates other federal laws, including, but not limited to, the Communications Act of 1934.
Huntington Beach, on the other hand, restated the basic argument it and other local governments have made – that the FCC doesn’t have the authority to confiscate local property…
The Order significantly limits the rights of state and local governmental entities such as Petitioner, City of Huntington Beach, to regulate, and lease its own property for the installation of Small Wireless Facilities (“SWF”) in the public rights-of-way (“ROW”) and on city-owned streetlights, and traffic signals. SWFs will be installed primarily for the deployment of 5G Wireless Networks. The Order is an unlawful pre-emption of local and state government authority.
In the “other thoughts” box on the form, the City of Seattle added that this isn’t the kind of question that’s suitable for mediation…
Every major wireless service and infrastructure provider, hundreds of communities, and many individuals and associations participated in the Commission proceedings which resulted in the Declaratory Ruling and Third Report and Order that is the subject of this appealed. We do not believe it possible that this matter can be resolved through mediation owing to the nature and scope of the issues at hand and the numerous participants.
Mediation, or at least considering it, is a standard step in a federal appeals case. Given the scope of the issues involved and the necessary process at the Federal Communications Commission, it’s a pretty safe assumption that the case will be argued, and not mediated away.
The FCC will have a month to respond, then the challengers will have three weeks to file a final rebuttal. So it’ll be the end of May before all the opening arguments are on the table. After that, it could be a year or more before the process is complete and the San Francisco judges issue a decision.
Six of those challenges were filed by cities, counties and their associations that contend that the FCC went beyond the authority it was granted by congress, if not beyond the bounds of the federal constitution. The other three were submitted by mobile carriers who thought they should have been given even more freebies by the FCC.
Those cases were transferred to the San Francisco-based ninth circuit by the tenth circuit court of appeals in Denver, which agreed with arguments made by the City of San Jose and other local agencies that the FCC’s September wireless preemption order and its August wireline preemption order were, for legal purposes, two halves of the same decision.
There’s still a lot of housekeeping work to be done, though, before substantive arguments can begin. Four other challenges – one by AT&T and three by municipal challengers – are lodged in the federal appeals court based in Washington, D.C. Presumably those will be transferred to San Francisco, too, and then consolidated with all the others – September wireless order and August wireline order alike.
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.