Widescale power shutdown reveals the depth of Californias infrastructure problems amid a growing climate crisis
When the United States largest investor-owned utility, Pacific Gas and Electric, shut down power to millions of Californians this week, nearly no one was ready. Not governments. Not businesses. And certainly not the general public.
As parts of the state went dark, the California governor, Gavin Newsom, told reporters he was outraged because it didnt have to happen.
Theyre in bankruptcy due to their terrible management going back decades. Theyve created these conditions, it was unnecessary, he said about PG&E. This cant be the new normal.
But Newsom also called public safety power shutoffs in cases of potential wildfire risk not novel. State regulators approved PG&Es plans. And the municipalities that called on vulnerable residents to use personal resources to pre-emptively evacuate knew this was coming.
The wide-scale public safety power shutdown revealed the depth of Californias infrastructure problems amid a growing climate crisis, as de-energizing policy trades one possible disaster for another.
Its a whole series of missteps over a long period of time by PG&E and by a whole bunch of other actors that led us to this point, said Costa Samaras, a climate resilience researcher and analyst, and associate professor at Carnegie Mellon University. What is clear is whatever this giant mess is, its not in any way acceptable or sustainable.
PG&E and de-energizing
PG&E made shutting down its grid in dry, windy weather a core part of its wildfire management strategy in 2018, after the company faced $30bn in liabilities for their role in sparking two of the deadliest and costliest fires in California history. PG&E filed for bankruptcy shortly after.
With its new safety plan, the company essentially admitted that keeping the lights on was dangerous and potentially very expensive for its own bottom line. By choosing to shut down the grid this week, the utility might have stopped another spark and another massive bill.
PG&E may be a public utility the biggest electric utility in the US and it may have been shutting off its lines to millions of people in the interest of public safety, but it is not, and has never been, owned by the public.
With their huge monopoly markets and guaranteed rates of return, California utilities are attractive businesses for investors. Earlier this year, utilities asked the state for an even bigger payday. Meanwhile, PG&E invested millions in state lobbying, paid out $4.5bn in profits to shareholders over the last five years, and millions in executive bonuses all while deferring necessary maintenance and repairs to its system.
A lot of money went to dividends that shouldve gone to your trees, a federal judge told the company in April.
PG&E equipment has been blamed for sparking 17 out of 23 major fires across the state in 2017, and the 2018 Camp fire that all but destroyed the town of Paradise and killed 85 people. Following those two devastating fire seasons, PG&E filed for bankruptcy protection to cover its liability costs, which are expected to total upwards of $30bn, compared with the companys market cap of $20bn. Any liabilities incurred from a new, large, devastating wildfire might have affected the companys ongoing bankruptcy proceedings.