SAN FRANCISCO (CN) – Pacific Gas and Electric won’t be doling out big payments to shareholders until it removes all wildfire hazards from around its power lines under the terms of newly proposed probation terms unveiled Tuesday night.
U.S. District Judge William Alsup released the proposed conditions late Tuesday, following weeks of debate over what an appropriate set of probation terms should look like.
PG&E had complained Alsup’s original proposal to make it re-inspect its entire electrical grid, trim or remove all trees near its power lines and shut off power in windy conditions could cost the company $150 billion. State officials and federal prosecutors also warned those terms would interfere with the jurisdiction of state and federal regulators.
On Tuesday, Alsup revealed a new proposal that would require PG&E meet every target and deadline in its $2.3 billion wildfire plan submitted to the state, maintain verifiable records on its progress and submit to the oversight of an independent, court-appointed monitor.
Additionally, Alsup suggested that PG&E pause any future payouts to shareholders to ensure it has adequate funding to meet its goal of clearing all wildfire hazards around its power lines within the next eight years.
“To ensure that sufficient financial resources are available for this purpose, PG&E may not issue any dividends until it is in compliance with all applicable vegetation management requirements as set forth above,” Alsup wrote in his 8-page order.
Another probation term requires that PG&E comply with all state laws requiring it to clear trees and branches within a certain distance from its transmission and distribution lines.
Although PG&E suspended payouts to its stockholders after the October 2017 wildfires, it paid out $1.7 billion in dividends in 2017 and 2016. During that same time period, PG&E “knowingly failed to trim or remove thousands of trees” it had identified as hazardous, Alsup wrote.
“Some of these dividends could and should have been kept and used to bring PG&E into compliance with state and federal law with respect to what has become the number one cause of PG&E induced wildfires,” Alsup wrote.
PG&E responded in a statement that it is committed to completing the work outlined in its state-mandated wildfire prevention plan, which was submitted to state regulators on Feb. 7. The California Public Utilities Commission expects to approve a finalized version of that plan by the end of May.
“PG&E shares the court’s commitment to safety and agrees that we must all continue to work together with urgency to address the risk of wildfire throughout Northern and Central California,” PG&E spokesman James Noonan said in an emailed statement.
Noonan said the company would respond to the court’s order to show cause by the March 22 deadline set by the court.
Alsup is overseeing PG&E’s probation in a criminal case related to the fatal 2010 San Bruno pipeline explosion.
The judge set a hearing date on the proposed probation terms for April 2.