SAN FRANCISCO Citing Pacific Gas and Electrics serious safety problems, California utility regulators will now consider replacing its board of directors, breaking up the company in favor of smaller, regional energy suppliers and even taking it over and converting it to a public agency, they announced.
In an extraordinary statement issued late Friday at the start of the holiday weekend, the state Public Utilities Commission announced it will deeply investigate PG&Es safety culture by examining the companys current corporate governance, management, and structure to determine the best path forward for Northern Californians to receive safe energy service.
The announcement comes in the wake of last months Camp Fire in Butte County, the most destructive blaze in state history. It killed 86 people and destroyed the town of Paradise, burning nearly 19,000 structures. CalFire has yet to announce a cause, but it is investigating wind damage to a PG&E transmission tower at the site where the fire started. Numerous lawsuits against the company alleged the tower was poorly maintained.
Following the San Bruno gas pipeline explosion, the North Bay fires last year and other blazes blamed on the utility, regulators will now consider actions PG&E critics have clamored for years.
Commission president Michael Picker expressed caution over what he and other regulators will attempt.
This process will be like repairing a jetliner while its in flight. Crashing a plane to make it safer isnt good for the passengers, Picker said in the announcement.
This is not a punitive exercise. The keystone question is would, compared to PG&E and PG&E Corp. as presently constituted, any of the proposals provide Northern Californians with safer natural gas and electric service at just and reasonable rates, Picker said.
According to its statement, the commission is looking at seven possible actions against the company. It will consider whether:
some or all of the existing PG&E directors be replaced by directors with a stronger background and focus on safety. The 12-member board of directors includes Benito Minicucci, head of Alaska Airlines, Roger Kimmel, vice president of the investment bank Rothchild Inc, Richard Meserve, former president of the Carnegie Institution of Washington and Anne Shen Smith, the former CEO of the Southern California Gas Company. the company retain new corporate management. the commission condition PG&Es return on equity on safety performance; PG&Es natural gas and electric distribution and transmission divisions be split into separate companies controlled by a holding company. PG&Es corporate structure be reorganized with regional subsidiaries based on regional distinctions. should the commission revoke holding company authorization so PG&E is exclusively a regulated utility; some or all of PG&E be reconstituted as a publicly owned utility or utilities.