PG&E claims rates could skyrocket five-fold if ordered to clear trees, inspect electricity system

PG&E warned in a new court filing that it would have to spend at least $75 billion, hire 650,000 workers — and increase monthly utility bills by a huge amount — if it’s forced to comply with a federal judge’s proposed order for a massive maintenance and inspection effort for its electricity grid.

The warnings by the embattled and cash-strapped utility, which has staggered to the brink of insolvency, were contained in a lengthy response ahead of a hearing in U.S. District Court next week.

Federal Judge William Alsup has signaled he may order PG&E to undertake a thorough inspection of its electricity grid and to launch a wide-ranging vegetation management plan ahead of the upcoming 2019 fire season in Northern California. Alsup is supervising the company’s probation connected with PG&E’s conviction for felonies the company committed before and after a fatal gas explosion in 2010 that killed eight and destroyed a San Bruno neighborhood.

“The resources required to comply with the (judge’s proposed order) do not exist,” PG&E stated in a federal court filing. “PG&E does not have the necessary funds. Were PG&E allowed to pass on the costs, the rate increases would be oppressive.”

PG&E estimated the rate increases in one year would be more than five times current rates in typical utility bills for 16 million Californians.

That means monthly utility bills would average $835 a month, according to the estimates PG&E provided in the court filing.

PG&E monthly bills rose on Jan. 1. Combined electricity and natural gas bills rose to an estimated $167.02 a month for the average residential customer, an increase of 0.7 percent. Electricity bills declined to a new level of about $112.08, a 1.5 percent reduction. Gas bills jumped to $54.94, a 5.1 percent increase.

PG&E faces a Chapter 11 bankruptcy filing as soon as next week as it faces a mountain of debts and liabilities — including unknown amounts of payouts to fire victims — in the wake of catastrophic and deadly wildfires that scorched Northern California in 2017 and 2018.

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. PG&E disclosed that it suffered equipment failures near the point of origin of a fatal blaze in Butte County in 2018.

“PG&E estimates that the cost of full compliance with the order might approach between $75 billion to $150 billion,” the company stated in the court filing.

The utility shouldn’t require anything close to this amount of money to create a much safer electricity grid, said state Sen. Jerry Hill, a Democrat whose district includes parts of Santa Clara and San Mateo counties and contains San Bruno.

“The amount of money PG&E is talking about is really excessive,” Hill said.

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