California’s beleaguered utility quits criminal probation, but more charges loom

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SAN FRANCISCO — Pacific Gas & Electric is set to be released from five years of criminal probation, despite concerns that the nation’s largest utility remains too dangerous to trust after years of devastation from wildfires sparked by its obsolete equipment and negligent management.

The probation, which was set to expire Tuesday at midnight, was meant to rehabilitate PG&E after it was convicted in 2016 of six felony felonies following a 2010 explosion triggered by its natural gas lines that blew up a San Bruno neighborhood and killed eight people.

Instead, PG&E has become an even more destructive force. Since 2017, the utility has been blamed for more than 30 wildfires that have wiped out more than 23,000 homes and businesses and killed more than 100 people.

“During these five years, PG&E has embarked on a series of crimes and will emerge from probation as a continuing threat to California,” U.S. District Judge William Alsup wrote in a report examining his public service oversight. .

While on probation, PG&E pleaded guilty to 84 counts of manslaughter for a 2018 wildfire that wiped out the town of Paradise, about 170 miles (275 kilometers) northeast of San Francisco. Now PG&E faces additional criminal charges in two separate cases, for a 2019 Sonoma County wildfire and a 2020 Shasta County fire. PG&E has denied foul play in those fires.

Even more potential criminal charges loom. California regulators have previously linked PG&E to the massive Dixie Fire last year, when a tree reportedly hit utility distribution lines in the Sierra Nevadas – part of a sprawling and often rugged utility territory spanning 16 million Northern California customers.

During his probation, PG&E also plunged into bankruptcy for the second time in less than 20 years. Before emerging from bankruptcy last year, PG&E reached settlements for more than $25.5 billion, including $13.5 billion for victims of the wildfires who may not distribute the amount originally promised.

PG&E’s conduct prompted its court-appointed monitor, Mark Filip, to sound the alarm on the utility’s wildfire prevention efforts, though he applauded ‘sustained and substantial’ improvements to its operations. of natural gas.

“We doubt anyone would seriously claim that PG&E’s performance has been adequate, or that substantial improvement is not yet imperative,” Filip’s team wrote in a report filed with Alsup late in the year. ‘last year.

PG&E, a 117-year-old company, generates about $20 billion in revenue a year while serving a 70,000 square mile (181,300 square kilometer) service area in northern and central California that includes farmland , forests and big cities. and the global technology hub of Silicon Valley.

Alsup, who repeatedly excoriated PG&E during his probation, last year signaled that he was interested in keeping the utility under his watch. But he dropped the idea earlier this month after the U.S. Attorney’s Office filed paperwork indicating he had no intention of seeking an extension to PG&E’s probation, citing “history and the unique circumstances” of the case.

“We have worked hard to rehabilitate PG&E, Alsup wrote in his final report. “As supervising district judge, however, I have to admit failure.”

Alsup declined an interview request from The Associated Press to explain his concerns about PG&E.

Catherine Sandoval, an energy professor at Santa Clara University and a former California electricity regulator, believes Alsup was far too hard on himself, though she agrees PG&E hasn’t proven that he should be released from all supervision. She blames federal prosecutors for backing down from an attempt to extend PG&E’s probation because “there does not appear to be any binding case law on this point,” according to the U.S. attorney’s report.

“If there was ever a test of whether a company’s probation period could be extended, it’s PG&E,” Sandoval said in an interview. She also fought unsuccessfully to hold a hearing to extend public service probation in a 58-page brief filed with Alsup earlier this month.

Noah Stern, the federal prosecutor in charge of probation for PG&E, did not respond to a request for comment.

While acknowledging its problems, PG&E claimed in a report to the judge that its power grid is “fundamentally safer” now than it was in January 2017. It also defended the roughly 40,000 employees and contractors who maintain its operations.

“Vilifying them and threatening to criminalize the exercise of professional judgment or the making of honest mistakes serves neither safety nor fairness, and seriously undermines PG&E’s efforts to bring the skills of the best and the brightest to bear on stopping wildfires,” PG&E’s attorneys wrote. . “We are all in there.”

As a sign of its progress, PG&E cited the more than 3.3 million trees near its equipment that have been trimmed or removed in the past two years.

The utility says it now spends $1.4 billion a year on trimming or removing trees, up from $400 million a year in 2017. But Alsup estimates that PG&E still has a seven-year backlog of trees to high risk that need to be trimmed or removed.

The company also cited a sweeping overhaul of its board and leadership, including the arrival of Patricia Poppe as its new CEO last year. Poppe, a former Michigan utilities executive, became PG&E’s fifth CEO in five years, amid an unusually high turnover rate that the company’s federal comptroller says is making reform more difficult.

“We know there’s still a long way to go,” PG&E attorneys told Alsup in their final internship report. “It’s not just words on a page or a poster, it’s a commitment to doing things right and keeping Californians safe.”

PG&E declined to comment on the end of his probation period.

Sandoval, who was among the regulators overseeing PG&E as commissioner of the California Public Utilities Commission from 2011 to 2017, accused PG&E officials of being mired in a pattern of “cognitive immaturity” and “lazy thinking” that should compel its leaders and board of directors to submit to counseling.

“PG&E, the company, needs the training that a defendant would have received in prison to break the cycle of criminal thinking that endangers public safety,” Sandoval wrote in brief to Alsup.

In his separate report, Filip suggested that California consider regulatory changes or new approaches to controlling PG&E.

The federal comptroller has warned that in PG&E service territory, the consequences of a single misstep — a missed hazard tree, failure to replace corroded hardware on power lines — can be “death and destruction.” .

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