PG&E Power Shutdowns Anger Public Into Action?

Starting on Saturday, Oct. 26 and continuing through Wednesday, Oct. 30, Mendocino County joined 35 other Northern and Central California counties in a five-day Public Safety Power Shutoff (PSPS).

That’s the term Pacific Gas & Electric Company (PG&E) uses when it shuts off electricity to its customers in order to prevent its utility poles, towers, and power lines from being toppled by high winds and thereby igniting conflagrations.

But I don’t have to tell any of you that, since by now you are well aware of what happens when PG&E equipment fails.

When PG&E restored electricity to the Laytonville area around 5 p.m. on Wednesday, I told friends, “PG&E just turned the power back on just as I was getting acclimated to living in a Third World country.”

One ordeal folks in the Laytonville area didn’t have to endure was being deprived of water in addition to electricity. The Laytonville Water District was able to utilize a back-up generator allowing us to produce all the water our town needed during the 5-day PSPS event. Can you imagine how much more miserable the power outage would have been without water? As the S.F. Chronicle observed, “No heat, no light? Not so bad. No water? Much worse.”

One positive thing about the shutdown was it brought communities in 36 counties closer together as people pitched in and helped out neighbors and friends and strangers who were in need.

Of course, most folks rallied around their palpable hatred of PG&E and its criminal incompetence and callous attitude over the deaths of 100-plus human beings.

Altogether, 850,000 customers holding accounts with PG&E (that translates to approximately 3 million people altogether) endured the 5-day ordeal that brought closed gas stations, crowded grocery and home supply stores with nearly empty shelves, spoiled food in refrigerators, and packed resource centers with refugees from wild fires.

By the way, PG&E let the state know it’s not paying any customer claims on losses. What a company.

Meanwhile, as I discussed in a recent column, and now also reported in a L.A.Times story, “California power giant PG&E Corp. was stripped of its right to exclusively pitch a reorganization plan in court, escalating an already heated battle over the largest utility bankruptcy in US history. The shares dropped more than 25 percent in after-hours trading. U.S. Bankruptcy Judge Dennis Montali said he’ll allow bondholders including Pacific Investment Management Co. and Elliott Management Corp. to pitch their own restructuring plan alongside PG&E’s, so they can both come up with ways the utility could deal with an estimated $30 billion in wildfire liabilities. The damages, tied to blazes that its equipment ignited, forced the utility to file for Chapter 11 bankruptcy in January. It’s the latest twist in a massive bankruptcy case that has already attracted some of the biggest names in the financial world.”

The creditors, including the fire victims, have “spoken loudly and clearly that they want their proposal to be considered,” Montali said in his ruling. While PG&E’s plan is “on track as well as can be expected,” he wrote, so is the competing version from creditors.

“One plan emerging as confirmable is a very acceptable outcome,” Montali wrote. “And if both plans pass muster, the voters will make their choice or leave the court with the task of picking one of them.”

The court denied requests by other parties to let them offer recovery plans too.

“We are disappointed that the Bankruptcy Court has opened the door to consideration of a plan designed to unjustly enrich Elliott and the other ad hoc bondholders and seize control of PG&E at a substantial discount,” the company said.

Under bankruptcy law, a company has a limited amount of time to develop a reorganization plan and persuade creditors to vote in favor of it. Initially, no other competing proposals are allowed, so the bondholders needed permission from Montali before they could proceed. It’s unusual for a bankruptcy judge to grant such a request.

It’s really not surprising that our Sacramento politicians are getting nervous about PG&E’s future.

Gov. Gavin Newsom recently said he would “love” to see Warren Buffett’s holding company, Berkshire Hathaway, step into the bankruptcy proceedings and make a bid for PG&E.

Sam Liccardo, mayor of San Jose, is proposing that PG&E be transferred lock-stock-and-barrel to public ownership.

The City of San Francisco is actively working on a plan to acquire the monopoly’s San Francisco operations and infrastructure.

Sacramento Mayor Darrell Steinberg and a couple dozen other local government officials from other parts of California are proposing that PG&E be transformed from an investor-owned, private sector corporation into a customer-owned, public sector utility. The alliance of mayors and county supervisors sent a letter this past week proposing the deal to the PUC and Gov. Newsom seeking their support for the plan. Any public takeover attempt of PG&E would need to be approved by both the bankruptcy court and the PUC. Needless to say, the main question would be, where does the money come from for a public buyout?

One final PG&E tidbit, my Sacramento-based son, who works for the state Dept. of Education, emailed me that “some people are proposing customers stop paying their PG&E bills to protest what has been going on.”

Don’t you just love all this activity that’s been provoked by PG&E’s bad behavior?

Hopefully, at some point we’ll see some real productivity as well because it’s time for some kind of change, don’t you think?

(Jim Shields is the Mendocino County Observer’s editor and publisher, and is also the long-time district manager of the Laytonville County Water District. Listen to his radio program “This and That” every Saturday at 12 noon on KPFN 105.1 FM, also streamed live: http://www.kpfn.org.)

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