PG&E in California Seeks $3.6B in Rate Hikes for Wildfire Safety

July 2, 2021

Pacific Gas & Electric asked regulators Wednesday to grant a $3.6 billion rate hike to help it pay for hardening its power systems to prevent deadly wildfires.

The nation’s largest electric utility requested the hike beginning in 2023, with half of the increase devoted to wildfire safety, spokeswoman Lynsey Paulo told the Sacramento Bee.

The hike would increase the average residential bill by $36 a month for gas and electric service, although the state’s Public Utilities Commission typically only grants a portion of any requested rate increase, the Bee said.

PG&E, which has some 16 million customers in central and Northern California, sought the hike as the state prepares to enter the hot summer months amid warnings that the state is likely to face one of its earliest and most dangerous wildfire seasons yet.

Much of the state already is in a drought and experts are predicting hotter, larger and fiercer blazes both in California and throughout the West.

The Biden administration said Wednesday it is hiring more federal firefighters, and immediately raising their pay as the summer looms.

“The truth is we’re playing catch-up” on preparing for extreme heat and wildfires, Biden said, calling federal efforts “under-resourced” compared with the deadly threat posed by climate change and extreme drought.

In Northern California, thousands of people were under evacuation orders because of a fire burning about 250 miles north of San Francisco.

PG&E equipment has been blamed for sparking some of the state’s deadliest wildfires in recent years, most notably in 2017 and 2018 when a series of wildfires burned down more than 28,000 buildings and killed more than 100 people.

The devastation prompted PG&E to spend 17 months in bankruptcy court, where it negotiated a $13.5 billion settlement with some wildfire victims. It also resulted in the company pleading guilty to 84 counts of involuntary manslaughter in Butte County, where the town of Paradise was wiped out by the Camp Fire in 2018.

State investigators also have linked PG&E equipment to a 2019 fire in Sonoma County that forced nearly 200,000 people from their homes and a Shasta County blaze last year that left four people dead. The utility has estimated those disasters could cost shareholders more than $600 million in damages.

PG&E emerged from bankruptcy last summer but also has run into criticism for shutting off power to thousands in rotating blackouts during some dangerous fire conditions in an effort to prevent power lines from falling or being fouled by tree branches and sparking fires during high winds.

PG&E said it has been spending money to better forecast the weather, quickly detect downed lines and install self-contained power systems to supply electricity when safety blackouts are called.

However, the utility’s rate hike request was angrily condemned by The Utility Reform Network, a San Francisco-based consumer group.

“This mind-boggling PG&E increase is a slap in the face to millions of California residents still hurting economically from the pandemic and struggling to get back on their feet,” Mark Toney, the group’s executive director, said in a statement.

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