Economy PG&E: Troubled Power Utility to Pay $125 Million in Fines and Penalties for the Kincade Fire of 2019

I'm assuming that PG&E haven't settled with the people who died from those fires yet either.

As of this time, 85% of claims are settled for $12 Billion.


PG&E reaches second settlement relating to wildfire claims for $11 billion
Published Fri, Sep 13 2019

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An aerial view of homes destroyed by the Camp Fire on February 11, 2019 in Paradise, California
PG&E said it has reached an $11 billion settlement agreement with entities representing about 85% of insurance subrogation claims relating to 2017 and 2018 wildfires.

The California power provider said these claims were based on payments made by insurance companies to individuals and businesses with insurance coverage for wildfire damage.

In January, PG&E filed for bankruptcy protection and faced up to $30 billion in fire liabilities shortly after its power lines sparked what became California’s deadliest wildfire yet last fall. The Camp Fire, which burned in Paradise, California, last November, killed at least 86 people.

Equipment owned and maintained by the company also started at least 17 of the 21 major wildfires that burned in California in 2017, according to the California Department of Forestry and Fire Protection. The company expects billions of dollars in losses, primarily from lawsuits filed by fire victims, businesses and insurance companies.

“Today’s settlement is another step in doing what’s right for the communities, businesses and individuals affected by the devastating wildfires,” said Bill Johnson, president and CEO of PG&E.

The $11 billion settlement is the utility’s second major resolution of wildfire claims. PG&E and 18 other entities said they reached a $1 billion settlement in June.

The company on Monday also unveiled the outlines of a reorganization plan that will pay $17.9 billion for claims stemming from the wildfires. That preliminary plan was immediately criticized by victims, who said that less than half of that is intended for them.

The plan has payments capped at $8.4 billion for victims, payments capped at $8.5 billion for reimbursing insurers and a $1 billion settlement with local governments.

https://www.cnbc.com/2019/09/13/pge-reaches-11-billion-settlement-relating-to-wildfire-claims.html
 
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This is why monopolies, even the allowed natural ones, need extreme regulation.
 
They already had that discussion last year, and here's the rub:

1) The increase on the monthly bill would be 10x just to move overhead lines into the ground, because underground wires cost 10 times more than overhead.

2) Underground wires would be even more liable to damages since concrete-floored Californian cities floods like a mofo every time there's a storm, plus the ground below that concrete is constantly shifting back and forth from the weekly earthquakes.

3) Annual maintenance cost for underground wires inside the cities would be astronomical, when they have to dig up the roads and repave them for miles each time a simple inspection and troubleshooting is required.

Long story short, some stretches of wires in remote areas outside the city - especially in the areas where the fire risks are high - will be put in the ground, but the vast majority of the state's power grid where people actually live will remains overhead, for both economical and safety reason.

Power lines keep sparking wildfires. Why don’t California utility companies bury them?
BY TONY BIZJAK, SOPHIA BOLLAG AND DALE KASLER | NOVEMBER 16, 2018

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https://amp.sacbee.com/news/business/article221707650.html
The reason I brought up the burying the lines is they have started doing that around me here in Florida. We don’t have fires but do it because we got rocked by hurricanes.
 
I know very little about PG&E.

But did they have a monopoly on providing power to houses and businesses in the area?

If local residents had no choice on who to get their electricity from, how does the governor of California think a government monopoly would be better?
 
To all the WarRoom posters and mods who live in California, get out while you still can.
I'm stuck for at least another 14 years... have to wait till kiddo is 18 before I can leave due to custody issues. And being vested in CalPERS.

Every single cop and firefighter I know who is retiring is going out of state
 
I'm stuck for at least another 14 years... have to wait till kiddo is 18 before I can leave due to custody issues. And being vested in CalPERS.

Every single cop and firefighter I know who is retiring is going out of state

You are so fucked.
 
I would think that the state almost has to. Or at least take it over long enough to sort it out and then auction it back into the private sector. It's a public utility, I don't think the state can or should ignore what that means for its residents.

FWIW this is the second time in the past 2 decades that PGE has filed bankruptcy. California tax payers bailed them out last time as well

If the state chooses to let them fail then they pretty much have to take over or all hell will break loose

Well then that seems like the easy answer then.

The gov't can bail out PGE with Equity that basically wipes out all the current equity and gives the gov't 100% control. At a future point the gov't can either choose to, or not, resell that equity to private interests to reimburse the public purse or if they find owning it works better, just keep it. There should be no real objections to this as new equity would almost certainly not come in now anyway unless they had some form of gov't certainty and a bail out to make it appetizing enough. And why should the gov't give those, with no control when they can do it and have 100% control?
 
I'd credit UC Berkeley and the advent of the internet starting there for silicon valley.
At one point Berkley probably had a majority of types who could excel in this type if actual creative and technical production. The technical, smart, and talented people are more often getting into trades now.
 
God forbid the state take over PG&E. That's communism.

What California needs to do is hand billions in tax payer funded bailouts to the company to help make it whole again. That's the free enterprise solution. And the only right answer.
 
Well then that seems like the easy answer then.

The gov't can bail out PGE with Equity that basically wipes out all the current equity and gives the gov't 100% control. At a future point the gov't can either choose to, or not, resell that equity to private interests to reimburse the public purse or if they find owning it works better, just keep it. There should be no real objections to this as new equity would almost certainly not come in now anyway unless they had some form of gov't certainty and a bail out to make it appetizing enough. And why should the gov't give those, with no control when they can do it and have 100% control?
You’d be surprised at the amount of people who would prefer PGE to fail and not have the government keep the electric grid running
 
God forbid the state take over PG&E. That's communism.

What California needs to do is hand billions in tax payer funded bailouts to the company to help make it whole again. That's the free enterprise solution. And the only right answer.
We should examine the ways in which the free market would handle this situation

What’s the likelihood of access to electricity being cut off from some or all customers under truly free market?
 
We should examine the ways in which the free market would handle this situation

What’s the likelihood of access to electricity being cut off from some or all customers under truly free market?

Competition would start kicking in and companies would be created to provide service to the under-served, bro.
 
The reason I brought up the burying the lines is they have started doing that around me here in Florida. We don’t have fires but do it because we got rocked by hurricanes.

Well there you go. Your #1 natural phenomenon happens above the ground, whereas California's #1 natural phenomenon starts from below the ground.

With overhead power lines strung with some slacks between ANSI-standard wooden utility poles made from tough yet flexible southern pine, douglas fir, and red cedar, everything above ground just gently sway back and forth a little bit in a typical earthquake and then return to their place, nothing actually breaks. In fact, I have never seen a wooden utility pole in our town to go down in an earthquake, whereas that would be the norm in a Florida hurricane. The worst thing that usually happen in the monthly tremors in California is a blown transformer here and there, but they are easily spotted and usually repaired within the hour.

Put those sensitive lines and electrical equipments below the ground and they would stretch and breaks when the ground starts moving in unpredictable directions in an earthquake, and it would cost millions of dollars and weeks to dig everything up to see where the breakages are after each earthquake.

It make perfect sense why the Eastern seaboard (and everyone in the Atlantic for that matter) should put all their power lines below to shield them from certain destruction by the annual Category 3/4/5 hurricanes, whereas it makes no sense for California to bury them underground to shield them from the monthly earthquakes.

If PG&E isn't so behind in their maintenance schedule (and going so far as falsifying record to make up for it), a lot of the disasters that they've caused wouldn't have happened at all.
 
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Well there you go. Your #1 natural phenomenon happens above the ground, whereas California's #1 natural phenomenon starts from below the ground.

With overhead power lines strung with some slacks between ANSI-standard wooden utility poles made from tough yet flexible southern pine, douglas fir, and red cedar, everything above ground just gently sway back and forth a little bit in a typical earthquake and then return to their place, nothing actually breaks. In fact, I have never seen a wooden utility pole in our town to go down in an earthquake, whereas that would be the norm in a Florida hurricane. The worst thing that usually happen in the monthly tremors in California is a blown transformer here and there, but they are easily spotted and usually repaired within the hour.

Put those sensitive lines and electrical equipments below the ground and they would stretch and breaks when the ground starts moving in unpredictable directions in an earthquake, and it would cost millions of dollars and weeks to dig everything up to see where the breakages are after each earthquake.

It make perfect sense why the Eastern seasboard (and everyone in the Atlantic) should put all their power lines below to shield them from the annual Category 5 hurricanes, whereas it makes no sense for California to bury them underground to shield them from the monthly earthquakes, even if they are affected by the wild fires once a year.
If the BART train can safely travel underneath the Bay then we can safely build electrical lines underground. And it’s not even every line, just lines in high risk areas.

Is it gonna take a major city burning to the ground to make something happen? We got pretty close with Bakersfield and Redding, completely lost Paradise. It’s only a matter of time.
 
They already had that discussion last year, and here's the rub:

1) The increase on the monthly bill would be 10x just to move overhead lines into the ground, because underground wires cost 10 times more than overhead.

2) Underground wires would be even more liable to damages since concrete-floored Californian cities floods like a mofo every time there's a storm, plus the ground below that concrete is constantly shifting back and forth from the weekly earthquakes.

3) Annual maintenance cost for underground wires inside the cities would be astronomical, when they have to dig up the roads and repave them for miles each time a simple inspection and troubleshooting is required.

Long story short, some stretches of wires in remote areas outside the city - especially in the areas where the fire risks are high - will be put in the ground, but the vast majority of the state's power grid where people actually live will remains overhead, for both economical and safety reason.

Here's more recent data on the astronomical costs of putting overhead wires underground inside Californian cities that I mentioned earlier.


Why not bury California's fire-prone power lines underground? The reason is sky high
Janet Wilson, Palm Springs | Desert Sun Oct. 11, 2019

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Why can't California's fire-prone power lines be buried underground, out of harm's way?

That was the question many Californians were asking this week as hundreds of thousands of customers lost power in the Sacramento and San Francisco areas in preemptive shutoffs by Pacific Gas & Electric. Further south, another 200,000 customers of other utilities faced warnings that they too could lose power due to high winds.

Experts say the answer is simple: money.

"It's very, very expensive," said Severin Borenstein, a UC Berkeley professor of business administration and public policy who specializes in energy. Borenstein was speaking through the crackly static of a cell phone outside his darkened home in the San Francisco suburb of Orinda on Thursday evening. The Berkeley campus was shut down and his home had lost power too after PG&E instituted a mandatory "de-energization" across nearly 40 counties due to high fire threats.

It costs about $3 million per mile to convert underground electric distribution lines from overhead, while the cost to build a mile of new overhead line is less than a third of that, at approximately $800,000 per mile, according to a section on PG&E's website called Facts About Undergrounding Power Lines.

California has 25,526 miles of higher voltage transmission lines, and 239,557 miles of distribution lines, two-thirds of which are overhead, according to CPUC. Less than 100 miles per year are transitioned underground, meaning it would take more than 1,000 years to underground all the lines at the current rate.

$15,000 for every PG&E customer?

PG&E, the state's largest utility, maintains approximately 81,000 miles of overhead distribution lines and approximately 26,000 miles of underground distribution lines. It also has about 18,000 miles of larger transmission lines, the majority of which are overhead lines.

At a cost of $3 million per mile, undergrounding 81,000 miles of distribution lines would cost $243 billion. PG&E has 16 million customers; distributing that expense equally would amount to a bill of more than $15,000 per account.


"It's very expensive," said Constance Gordon, a public information officer with the California Public Utilities Commission. "The utilities don't want to pay for it out of their pockets, so ratepayers would have to pitch in, and people don't want to pay for that."

PG&E is not flush with cash: The investor-owned utility filed for bankruptcy in January, facing $11 billion in liabilities related to wildfires. This week, the company's shares tumbled after a federal bankruptcy judge ruled that the utility no longer had the sole right to shape the terms of its reorganization.

Underground costs can vary depending on trenching and paving. If gas and telephone utilities share costs with electric companies, conversion costs can come down, but it all comes out of the customer's pocket eventually.

A report prepared by the Edison Electric Institute, “Out of Sight, Out of Mind, An Updated Study on the Undergrounding of Overhead Power Lines,” found that while most new commercial and residential developments across the United States tuck electrical facilities underground,burying existing above-ground electric distribution systems can cost up to $5 million a mile in urban areas.

Environmental concerns would also be high if thousands of miles of trenches were dug through forests or brushland habitat, Borenstein noted. Opposition could also arise from residents in existing neighborhoods confronted with the prospect of heavy-duty earth-moving projects.

Neighborhoods can tax themselves to bury lines

Since 1967, the California Public Utilities Commission has had a rule requiring utilities to contribute funds to communities for utility conversion projects from overhead to underground infrastructure, paid for partially by ratepayers.

The CPUC has a longstanding policy that if a neighborhood wants underground power lines, it can have it done if residents pay for it themselves, with some required contributions from utilities. Sometimes developers and cities are willing to pitch in for certain areas, but the process is still labyrinthine.

That program does not prioritize lines in high wildfire hazard risk zones, but some residents in communities that experienced wildfires, including coastal Malibu and Rancho Palo Verde, have pushed for that policy to change to prioritize risky areas.

Sometimes the concerns are more centered on aesthetics than safety, and communities are willing to pay, or to have their local governments work to find funding. In the city of Palm Desert in the Coachella Valley, for example, residents' demands to bury unsightly lines led the city council to approve a $600 million underground utility plan in October 2018. But that's just the beginning of the process.

If residents want the utility lines moved underground, they have to initiate creating a special district to tax themselves to pay for the project. To create a special district, residents need to collect signatures, and residents within the district's boundaries need to vote on the issue. In Palm Desert, the city hopes to help fund some of these projects, such as by paying for the portion of the move underground that is on public property.

Electric wires are increasingly placed underground in areas of new construction for aesthetic reasons, with developers picking up the cost. And in Paradise, where the devastating 2018 Camp Fire sparked by a power line flattened most of the town and killed 86 people, PG&E is preparing to lay underground lines.

"I don't know if I agree with it," said Borenstein of that plan, who thought it could offer a false sense of security. "Though when you are starting from scratch, it is much cheaper if all the houses have burned."

But Borenstein and others noted that problems can occur underground as well. Animals can chew buried lines or lightning can short out ground connections, just as animals can damage lines overhead, or a dry tree branch can drop. The state's extremely varied landscapes are another challenge.

"In some places undergrounding works, and in some places it doesn’t," said Mark Ghilarducci, director of the Governor's Office of Emergency Services. "California’s topography is challenging. ... I do know PG&E has taken a concerted effort, as well as all the utilities, to do undergrounding where possible."

Governor signs more than 20 fire-related bills

The solutions for PG&E's fire-prone wires are straightforward, but will take time after years of neglect, said a clearly irritated Gov. Gavin Newsom at a Thursday press conference. PG&E needs to be brought into the 21st century in terms of technology, and the utility's equipment needs to be "hardened" against fire threats and maintained properly, he said.

"But to harden and upgrade 100,000 miles of line, come on, that's not gonna happen in a week or two, or even a month or two, or a year or two," said Newsom.

Earlier this month, Newsom signed into law over 20 wildfire-related bills, including SB 70, authored by Senator Jim Nielsen (R-Gerber). that measure requires the state's three big utilities to include in their wildfire mitigation plans consideration of undergrounding utility lines in the highest fire hazard risk areas. It does not force the utilities to take action.

SB 584, introduced by Sen. John Moorlach (R-Orange County), would require electrical corporations to invest funds for overhead to underground electrical infrastructure conversion projects by July 2020. The projects would be partially funded by grants from the Department of Forestry and Fire Protection. But the bill has languished on the floor.

Borenstein agreed that vegetation management and hardening transmission and distribution lines are better, more easily implemented alternatives than burying 100,000 miles of lines.

"That means mowing, cutting trees, perhaps replacing wooden poles with concrete poles, and all the rusted transmission towers," he said. "They're trying to do these things, but they have a huge backlog of work."

Other possible measures include insulating exposed lines or installing sensors, including cameras or devices that can detect a spark or a short and even shut down a line automatically.

https://www.desertsun.com/story/new...ia-fire-prone-power-lines-why-not/3937653002/
 
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