Last year, equipment owned by PG&E directly caused at least 16 wildfires. State investigators have determined at least 11 of them were due to negligence. These fires have caused billions of dollars in damages, wrecked whole communities and even cost innocent lives. With a track record like this, one might expect PG&E to be working overtime to improve tree-trimming and prevent future ignitions.
But instead, PG&E is lobbying the state Legislature to pass the buck onto its customers and rig the system in PG&E’s favor. The company’s lobbyists are pushing legislation now to allow PG&E to raise rates on its customers for “cost recovery” when its power lines and other equipment cause wildfires – without being held accountable for actually improving safety or minimizing fire risk. All told, customers could be left holding the bag for up to $15 billion in new liabilities.
Californians already pay some of the highest rates for electricity in the country, which are at least 41 percent higher than the U.S. average. These excessive PG&E bills contribute significantly to California’s skyrocketing “cost of living” index that, according to the Census Bureau, gives California the highest rates of poverty in the nation. For millions of middle-class households struggling to make ends meet in the expensive Bay Area and other parts of California, sky-high energy bills can make the difference between just making it, or spiraling into poverty.
This doesn’t seem to concern PG&E. And why should it? In 2017, the same year PG&E caused at least 16 devastating wildfires, its shareholders drew $1.66 billion in profits and its executives nearly doubled their salaries. In fact, PG&E’s CEO raked in $8.6 million in pay and perks last year – a raise of over 100 percent since 2016 – while the company’s lobbyists aggressively urged policymakers to make it easier to charge ratepayers more.
Raising utility rates is typically a thoroughly vetted, public process regulated by the California Public Utilities Commission. In past years, customers could at least take comfort that their due process rights were safeguarded by a highly transparent and rigorous rate-setting process that afforded ratepayers an opportunity to participate and check any unfair increases on rates.
But the new legislation backed by PG&E would short-circuit the CPUC’s process to undermine public participation and give utility lobbyists the edge in jamming through future rate increases. The legislation would sharply restrict the time periods allowed for public review and comment on rate cases, and gut innovative wildfire mitigation programs recently approved by the CPUC.
Facing billions in damages for PG&E’s own negligence, this is a systematic attempt to shift liability onto the ratepayers and cut them out of future decisions.
Fortunately, there is hope. In the wake of 2017’s disastrous wildfires, the Legislature has formed a new committee to pass laws strengthening prevention and mitigation measures. And among its founding principles is the committee’s duty to ensure a fair allocation of prevention and response costs in a manner that protects ratepayers by holding utilities accountable.
The ability of millions of Californians, many teetering on the brink of poverty, to access essential heat and light depends on lawmakers doing their jobs. PG&E and other investor-owned utilities should be held accountable for the role they play in California’s rash of wildfires, and not be allowed to heap their liabilities onto their already overburdened customers’ monthly bills.
Mark Toney is executive director of TURN, The Utility Reform Network, which is a member of the Ratepayer Protection Network, a coalition of residential and commercial customers.
