A store burns as the Camp fire tears through Paradise, California, on Nov. 8, 2018.
Pacific Gas and Electric’s almost inevitable announcement came Monday: The state’s largest utility, facing massive potential liabilities from recent wildfires that its poorly maintained equipment may have triggered, will file for bankruptcy on Jan. 29. In November, at least 86 people died and nearly 14,000 homes burned in the Camp fire in Butte County, and while no cause is confirmed, Cal Fire is investigating a PG&E tower and transmission lines.
This possible culpability in the deadliest, most destructive blaze in California history didn’t surprise outside watchdogs, who have faulted the utility’s corner-cutting on safety issues for years. A series of unsafe decisions literally blew up on PG&E in 2010, when a segment of its aging natural-gas pipeline exploded in San Bruno, a San Francisco suburb, killing eight people and destroying 38 homes. In 2016, a jury in a federal trial found PG&E guilty of five felonies for shoddy maintenance practices that led to the explosion and a sixth for obstructing the federal investigation into the disaster.
PG&E may survive its corporate bankruptcy — it used a 2001 Chapter 11 bankruptcy filing to deal with liabilities from the 2000-2001 energy crisis and emerged three years later in 2004. But even if a new PG&E emerges with a culture that cares more about safety than about investors’ dividends, Californians still have this profound reason to worry: The California Public Utilities Commission remains responsible for the safety of power utilities’ customers, and it has shown it can’t be trusted. The PG&E-related disasters might never have happened if the CPUC had done its job of careful oversight.
This is backed up by a 2015 National Transportation Safety Board report on the San Bruno disaster, which assailed the CPUC for its failure to appreciate the safety risks of a pipeline that relied on faulty molds that dated back to its 1956 installation. A 2015 investigation by KQED, the Northern California PBS station, was even more damning. It detailed the cozy relationships between regulators — including then-CPUC President Michael Peevey — and utility executives. For one example of many, it cited 2011 emails in which a top CPUC official casually kibbitzed with a senior PG&E executive on how the utility should play damage control in response to a critical San Francisco Chronicle article involving the San Bruno pipeline. Even though CPUC staff was charged with auditing PG&E’s pipeline inspections, CPUC officials had no complaints when PG&E began laying off gas-safety inspectors in the years before the pipeline exploded. Meanwhile, PG&E’s records claimed that the aging pipeline — which had never been pressure-tested — was in excellent condition.
Regulators “were pretty much in bed with the utilities, doing their bidding for them,” state Sen. Jerry Hill, D-San Mateo, told KQED at the time.
This continued after Peevey was replaced by Michael Picker. Consider the $1.6 billion “fine” that a Picker-led CPUC imposed on PG&E in 2015 for the San Bruno disaster. More than half the “fine” — $850 million — was for improvements to its natural gas transmission system that PG&E would have had to do anyways.
But the blame for tolerating PG&E’s amoral culture goes even higher than Peevey and Picker. Newly retired Gov. Jerry Brown’s legacy should be tarnished by his mixed history of making the CPUC more transparent about its dealings with utilities, including vetoing six reform measures in one day.
Picker is saying the right things now. In the aftermath of the incredible December report that PG&E falsified pipeline inspection reports for five years after the San Bruno disaster, the CPUC announced it would force major changes at the utility.
But it is far past time that the Legislature, with the support of new Gov. Gavin Newsom, make a similar decision about the CPUC. The enabler of PG&E’s perfidy must pay for its failed oversight.