California Commission Head Open to Replacing Utility Giant With Co-Op

(CN) - The head of California's Public Utilities Commission chastised Pacific Gas & Energy in a letter released Thursday, stating that she is open to replacing the utility giant blamed for costly wildfires and blackouts with a customer owned nonprofit cooperative.

CPUC President Marybel Batjer wrote about her openness to the idea in response to a Nov. 4 letter sent by several California mayors and county leaders who advocated for such a move. PG&E filed for bankruptcy in January after it was clear the company would be on the hook for about $30 billion in liability for wildfires started by its equipment.

The city and county leaders asked the commission to consider a bold alternative to a mere restructuring of the company post-bankruptcy.

“The commission must do more than approve a plan — any plan — merely so that the bankruptcy can be concluded,” the government leaders wrote.

PG&E has received criticism for its intentional blackouts this year that left millions of Californians without power. Company leaders said the blackouts were necessary to prevent additional wildfires as high winds across Central and Northern California intensified chances of spreading fires.

Despite the blackouts, PG&E equipment has been linked as possible causes to five different wildfires in October. The company is still on probation after a 2010 felony conviction stemming from an explosion of a gas pipeline.

Last month, the commission announced a formal investigation into the company's recent blackouts and possible safety violations.

In Batjer's letter, she called the utility's safety performance "unequivocally unacceptable."

"I grant that PG&E faces historically challenging and dynamic climate change conditions, but the company has failed to successfully execute even basic operations during times of crisis," she wrote. "From website failures to communication breakdowns in [blackout] events, PG&E’s inability to execute and implement the simple stuff is deeply troubling."

Batjer said there are "many benefits" from models such as a customer owned co-op that "warrant further consideration."

Other possibilities for restructuring the company include state ownership, as suggested by Gov. Gavin Newsom or a buyout by Warren Buffett's Berkshire Hathaway.

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