As the upcoming holiday season promises a new year and new budget proposals, Northern California’s PG&E remains in limbo, with wildfire victims remaining largely uncompensated. The saga involves mismanagement distributing an essential commodity, power, to 16 million people.
The state of California uses as much power just for holiday lights as El Salvador or Ethiopia use in a whole year.
As climate disasters mount, the world’s fifth-largest economy may adopt a northern and centrally located, publicly owned utility. This is a social-ecological issue that serves as nothing short of an international predictor for energy infrastructure.
PG&E remains court-ordered to pay past wildfire victims — customers and insurance companies — back, but company and state officials share the view that customers should pay for (at least some) future damages.
The new $21 billion state wildfire fund was established by AB 1054 — an extended Department of Water Resources (DWR) charge— which will raise $10.5 billion over 15 years from San Diego Gas & Electric Co, Southern California Edison, and PG&E “ratepayers” to be matched by participating companies.
The DWR Bond charge allowed for important PG&E business ratepayer exemptions. In fact, an independent audit of PG&E business classifications exempting bond payments is in order here.
On the prevention side, residents get offered equipment safety protocols and a wildly unpopular blackout strategy, as damages are estimated at $80 billion in 2019.
The 2019-2020 state budget is $214.8 billion, with a $15 billion criminal justice budget.
While the prison population has decreased by 30,000, the budget has increased by $7.5 billion in the same decade. Newsom mentions one California Correctional Peace Officers Association (CCPOA)-unfriendly savings option: closing a state prisons like dilapidated San Quentin or the California Rehabilitation Center.
California leads on social-ecological initiatives with longstanding budgetary consequences. But state leadership pays lip service to progressive reforms (like halting private prisons) and champions anti-pollution measures (like tighter emissions control standards), and the governor accepted a $208,000 PG&E campaign contribution. Some say this is why Newsom swiftly signed AB 1054, establishing the wildfire fund.
The social ecological rhetoric circulates, it just needs connecting and enacting. San Francisco is in a special position here with new District Attorney Chesa Boudin.
Instead of temporarily releasing volunteer prisoners to fight wildfires for dollars a day, prison closure savings transferred toward fair wildfire/climate disaster relief and prevention (including affordable sustainable housing) — and the public power utility option — loom as concrete solutions that do not punish prisoners or working families.
Last week, a federal bankruptcy court heard PG&E’s clemency appeal for victim compensation.
True to form, the company is trying to save $5.1 billion in victim compensation: “In its bankruptcy plan, PG&E has pledged to pay $8.4 billion to wildfire victims and an additional $11 billion to compensate insurance companies for their payouts. A competing proposal made by bondholders seeking to gain control of PG&E would pay wildfire victims $13.5 billion.”
PG&E can only access this fund if it meets certain conditions, including exiting “its bankruptcy case by next year without raising rates on customers. PG&E would also have to pay off its claims from 2017 and 2018 wildfires to join the fund, a measure wildfire survivor groups praised...”
Utilities must spend $5 billion on safety upgrades, get safety certified annually, and can only access funds “where their equipment causes more than $1 billion in property damage.”
While the company had no problem paying the Big Oil lobby millions, financial ties to PG&E grow politically untenable. House Speaker Nancy Pelosi, D-Calif., has a PAC that received $26,000 in PG&E contributions. Now Pelosi shakes her affiliation, cutting checks to local fire recovery charities.
But not so fast on the public relations move. Her money was rejected by Paradise, California’s Rebuild Paradise Foundation. 2018’s Camp Fire killed 85 people and burned 18,000 structures in the area.
A recent article by disaster capitalism expert Naomi Klein extensively documents how Chico, California’s municipal Green New Deal efforts are addressing residential needs using three political tools: the federal Green New Deal package, municipal/mayoral leadership commitments, and even organizing supported by the Mutual Aid Disaster Relief’s (MADR) anti-hierarchical framework. This all includes solidarity for migrant working families.
Not everyone agrees here: it’s California. But necessity is still the mother of invention. Californians’ needs warrant budget inventions to rectify grave spending priorities between departments.
