Federal judge asks PG&E: Should I ‘let you keep killing people?’ Rules utility violated its felony probation
SAN FRANCISCO — A day after PG&E filed for bankruptcy protection from what could be multi-billion dollar wildfire liability costs, a federal judge Wednesday declared the beleaguered utility in violation of its probation for the 2010 San Bruno gas pipeline explosion and spent three hours excoriating the company for its role in the blazes that have ravaged Northern California over the past two years.
“Does a judge turn a blind eye and let PG&E continue what you’re doing, let you keep killing people?” U.S. District Judge William Alsup said inside the San Francisco courtroom. “Can’t we have electricity that is delivered safely in this state?”
The finding sets the stage for the judge to add additional and costly terms to Pacific Gas & Electric’s criminal probation for the deadly pipeline blast — requirements such as inspections and tree trimming the utility says could cost billions of dollars and lead to customer rates rising five-fold. Alsup, who is monitoring the utility’s federal probation, did not make that decision at Wednesday’s hearing but said he would soon, as fire season begins in June. He said he would pay close attention to what PG&E submits as its newly required wildfire mitigation plan. That plan is due next week as part of a new state law.
Despite the brief respite, the judge strongly suggested he’d ratchet up safety requirements on the utility’s probation, saying he’s considering such simple restrictions as requiring that PG&E not start another fire. Among other measures, Alsup said he might require PG&E to adopt San Diego Gas & Electric’s system for shutting down power service during high winds that could fell trees or power lines and spark deadly, fast-moving wildfires. PG&E implemented its own de-energization plans last year — using it for the first time in October. But unlike San Diego, its policy excludes cutting service to transmission lines of 115,000 volts or higher, saying in the past that doing so interrupts service to far more customers than intended, among creating other problems.
The utility kept power running in Butte County despite warning customers for two days that it might curtail electric service due to extreme fire conditions forecast for Nov. 8, the day the Camp Fire erupted. PG&E has reported that a 115,000-volt transmission line suffered a power malfunction 15 minutes before the fire first was reported, in the same area where Cal Fire has said the fire started. No official cause has been determined for that fire. State regulators have said that power to high voltage lines can be interrupted for safety reasons.
Still, PG&E and CPUC attorneys continued to argue that there are significant impediments to power shutdowns that can cut cell phone connections, impact vulnerable medical patients and trap cars in garages, among other problems. But the judge grew exasperated with that explanation.
“Which is worse, another Butte County fire or that inconvenience?” Alsup asked. He added that proper warning would allow people to prepare for shutdowns and, for instance, keep their garage doors open those days.
Alsup opened the hearing before a packed courtroom by comparing PG&E to a drug dealer who violates probation by committing a different crime. He noted that PG&E equipment was involved in starting 17 recent wildfires and dismissed the company’s claims that it warned its probation monitor that the Butte County District Attorney’s office was investigating criminal actions by the utility involving fires during 2017. That inadequate notification, Alsup ordered, was a probation violation.
“Those fires killed 22 people, burned alive in their cars and homes,” Alsup said. “There is one clear pattern here: PG&E is starting these fires. Global warming is not starting these fires.
“You’ve got to be on your absolute best behavior — no more crimes,” Alsup warned.
On Tuesday, the San Francisco-based company filed for Chapter 11 bankruptcy, listing $51.7 billion in debts and $71.4 billion in assets, according to the filing with the U.S. Bankruptcy Court in Northern California. Alsup could further complicate the company’s financial hole depending on how he eventually rules.
Alsup has ordered PG&E to produce records explaining its role in wildfires linked to the company dating back to the 2017 fire season. State fire investigators have determined the company’s equipment caused 17 of the infernos in the North Bay Wine Country and nearby regions in 2017. Cal Fire also continues to investigate if a failure of PG&E equipment sparked November’s Camp Fire in Butte County, the deadliest and most destructive in state history, where 86 people perished. Last week, Cal Fire cleared PG&E in the Tubbs Fire, determining the destructive Oct. 8, 2017, blaze in Sonoma County was sparked by private electrical equipment. That fire alone killed 22 people.
Alsup could order the company to make a thorough inspection of its electricity grid and complete a wide-ranging vegetation management plan ahead of the fire season. He said trees or limbs falling into PG&E equipment was the biggest menace. PG&E wrote in a court filing that such a move would necessitate a $75 billion to $150 billion investment and the hiring of 650,000 workers.
New York attorney Kevin Orsini, representing PG&E, told the judge it would take eight years to clear trees in areas at high risk for wildfires under more stringent clearances because there are not enough specialized tree trimmers for the dangerous work. PG&E can’t just clear-cut trees near power lines because private property owners and communities fight them.
“It’s not a dollars issue … it’s a function of a qualified tree workers,” Orsini said, citing the dangers of working near live wires.
Alsup wasn’t convinced, noting the investor-owned utility’s profits and spending on lobbyists.
“In the last five years, $4.5 billion in dividends were paid out to shareholders,” Alsup said. “Some of that could’ve been paid out to cut trees. But all the money went to shareholders.”
The judge also questioned the California Public Utilities Commission, the state agency charged with regulating PG&E and other investor-owned utilities.
“How did it happen so many fires occurred under your regulations?” Alsup asked a representative of the state regulator. “It sounds harsh, but that’s what the people of California deserve to know, how did that happen?”
After three intense hours, Alsup told the parties he would rule later, but the state of California did not have time to waste with another fire season approaching.
“In two years, 3 percent of California burned up,” Alsup said. “Think about that. Three percent of the whole state burned up. We cannot continue to sustain these kinds of catastrophic injuries to the state, death and destruction. PG&E is not the only source of these fires, but it is a source and to most of us it’s unthinkable that a public utility is causing that type of damage.”
He then thanked newly appointed interim CEO John Simon, who sat in the front row, for attending the hearing.
“I listened carefully and I will take your points,” he told the judge in a brief exchange. Simon did not answer questions as he left the courtroom.
Mark Toney, executive director of The Utility Reform Network, said he was happy with Alsup’s no-nonsense approach toward PG&E but recommended the judge take the company into receivership.
“That way the receiver has the power to decided whether executives stay or leave, whether the board stays or leaves. But more importantly, a receiver will be accountable to the judge,” Toney said outside court.
Steps away, attorney Frank Pitre, who represents victims of the North Bay fires and Camp Fire, spoke about how his clients appreciated Alsup’s approach in court.
“None of the clients we represent want to see another family lose a loved one or see another family lose a home they’ve lived in for generations, or another family lose all their worldly possessions and live in a trailer,” Pitre told reporters. Inside the courtroom, Pitre was allowed to address the judge and recommended PG&E adopt the San Diego power shutdown plan and to improve training for vegetation inspectors.