Perfect Compliance With Wildfire-Safety Laws Impossible, PG&E Tells Judge

SAN FRANCISCO (CN) – Pacific Gas and Electric urged a federal judge not to impose new probation conditions that would force the company to hire more tree workers and tie executive bonuses exclusively to fire safety.

Overseeing PG&E’s criminal probation for felony convictions related to the fatal 2010 San Bruno pipeline explosion, U.S. District Judge William Alsup ordered the company in January to show cause why it should not be subject to new probation conditions. The order came after PG&E acknowledged it missed a key term of its criminal probation by failing to meet every fire-risk reduction target in its state-mandated wildfire safety plan.

A Pacific Gas & Electric photo of the transmission line C-hook that failed and sparked the deadly and destructive Camp Fire in November 2018.

In a 33-page response filed Wednesday night, PG&E said being forced to hire more tree workers would not quicken the pace of its work to clear vegetation hazards around power lines or reduce the need for mass power blackouts when dry, strong winds heighten the risk of fire. A court order will not change the reality of a nationwide and statewide shortage of qualified and experienced tree workers, the company said.

 

PG&E CEO Bill Johnson told the California Public Utilities Commission this past October that it could take 10 years before the company is in a position where widespread blackouts to prevent wildfires are no longer necessary.

In its response to the court, PG&E said the protracted timeline is not solely the result of a shortage of tree trimmers and inspectors but largely dependent on deploying technology for more accurate localized weather forecasts and real-time data, and sectionalizing power lines through the use of microgrids.

PG&E said it increased its workforce of contracted tree inspectors in 2019 from 580 to 1,375 and increased the number of contracted tree trimmers from 1,400 to 5,437.

The company argued that it should not be forced to hire inspectors and tree trimmers in-house when it has relied on contracted labor for decades.

“It would take years and hundreds of millions of ratepayer dollars (if not more) for PG&E to develop the infrastructure, workforce and training programs that PG&E’s contractors already have in place and have refined over time,” the company said in its filing.

PG&E further insisted that it will never be able to certify perfect compliance with state regulations that require at least four feet of distance between trees and power lines due to the sheer size of its 70,000-square-mile service area.

“Certification of perfect compliance with state-law standards would require technologically infeasible, round-the-clock surveillance of tens of millions of trees,” the company stated.

PG&E also pushed back on Alsup’s proposal to prohibit executive bonuses unless the company meets all goals outlined in its state-mandated wildfire safety plan. The company said such a restriction would conflict with Assembly Bill 1054, a state law passed in 2019 that permits utilities to compensate executives based on a mix of safety and financial considerations.

The company further complains that Alsup would be stepping on the toes of the utilities commission, which regulates PG&E’s bonus program, and U.S. Bankruptcy Judge Dennis Montali, who approved a $235 million employee bonus program last year. Montali rejected a proposed $16 million bonus plan for high-level PG&E executives.

“This court should not impose a condition that conflicts with or constrains the bankruptcy court’s review of PG&E’s employee compensation arrangements,” the company stated in its filing to Alsup.

PG&E’s current employee bonus plan is based on 65% safety, 25% financial performance and 10% customer service.

The company is in the process of seeking approval of a proposed 2020 employee bonus plan. The California Public Utilities Commission will hold hearings on the proposed bonus plan on Feb. 19.

PG&E said it already weighs safety more heavily in its bonus plans than most other investor-owned utilities. Eliminating financial performance from the equation would upset the balance state lawmakers and regulators have found is necessary to ensure the company provides safe, reliable and affordable energy, the utility argued in its filing.

“PG&E’s ability to safely provide power is in large part predicated on its financial stability, particularly in the context of the company’s bankruptcy,” the company said.

Earlier this month Alsup also ordered the company to answer questions about jumper cables, one of which was suspected of causing the Kincade Fire in 2019, and C-hooks, one of which snapped in 2018 and caused the most deadly and destructive wildfire in state history, the Camp Fire.

A hearing on the order to show cause why PG&E should not be subject to new probation conditions is scheduled for Feb. 19 in San Francisco.

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