Hurried, slapdash amendments to a proposed state Wildfire Fund plan pushed by Gov. Gavin Newsom improve it a little, eliminating secret meetings by a now-discarded new commission and forcing utilities to pay a full $5 billion for fire safety measures. But the plan still does not answer two key questions ignored by Newsom and the state Legislature:
Why should consumers pay for the negligent conduct of utility companies like Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric? And do these companies deserve to survive, considering how the largest two of them admit they’ve behaved?
Other huge problems also lurk in both the amended measure, known as AB 1054, and in Newsom’s original plan:
While the putative new Wildlife Fund Commission is gone, replaced by a fire advisory board with no real powers, vital decisions on whether utilities act responsibly remain with the state Public Utilities Commission despite its long history of corrupt favoritism of those same utilities.
The latest plan would let the PUC decide when utilities can issue bonds to pay for wildfire liabilities, with electric customers obliged to pay them off via increased rates. That’s on top of a mostly customer-paid fire claims fund that could exceed $30 billion.
There is no limit on how much in bonds the PUC could authorize, money consumers would have to repay as certainly and as regularly as they pay taxes. But no company could issue bonds if the PUC finds it was irresponsible.
Lawmakers giving the PUC these powers apparently don’t remember that this commission in secret and illegal meetings with SoCal Edison officials agreed to force consumers to pay two-thirds of the cost of decommissioning the San Onofre Nuclear Generating Station, closed in 2012 because of an Edison blunder. The PUC years later conceded this was wrong, changing its earlier decision to charge consumers about one-third less than before, a difference exceeding $1 billion.
Then there was a federal investigation that found PUC negligence as much at fault as PG&E’s criminal behavior for the 2010 San Bruno gas pipeline explosion which killed eight persons and destroyed much of that San Francisco suburb.
All this came before the huge wildfires of 2017-18 drove PG&E into bankruptcy because of expected fire claims in the tens of billions of dollars.
Now, the only limit on the PUC’s bond-authorizing ability in the Wildfire Fund plan, original or amended, is that it expires after 2035.
So the commission’s long history of favoring utilities and getting investigated for criminal collusion with Edison is ignored. AB 1054 would give the PUC a new way to help the utilities it consistently favors.
One other problem: While the current Wildfire Fund proposal forces customers to pay many billions, it does not name a single fire prevention move the utilities must take, even though their lines started multiple billion-dollar-plus blazes. Instead, the companies would bring safety plans to the PUC only once every three years, the aim to “harden” power lines, whatever that means.
“This entire plan does not focus on fires, but on ways to let the utilities keep making billions,” says former San Diego City Attorney Michael Aguirre, whose legal work caused the reduction in consumer payments for San Onofre. He threatens a lawsuit to cancel the new plan, if it becomes law. “It’s as if no one really wants to stop the fires.”
Meanwhile, Newsom keeps urging quick passage of AB 1054, with its current amendments and others likely to come. He says it must pass before the lawmakers’ impending summer recess or Wall Street will degrade utility bond ratings.
This rush to poor judgment again places utility interests ahead of consumers’, with no explanation why the present companies should be allowed to survive and keep their monopolies intact.
For despite a Newsom suggestion to the contrary, power would not disappear if the companies do: state law allows a government takeover of their systems if those firms fail, with employees guaranteed their jobs.
It all means slowing down this bill is a must to allow measured consideration of alternatives to the current system that frequently foments criminality and negligence.