The community choice aggregation (CCA) movement has built considerable momentum in California in recent years. In CCA programs, groups of local government agencies team up to take over decision-making on what sources of power to use in the local electric grid – with utilities continuing to hold responsibility for maintaining the grid. 

CCA advocates contend that not only will this lead to use of more environment-friendly types of energy, it will bring down rates for businesses and households by creating competition for utility companies that often have no rivals. Critics say decisions on what types of energy are used are already mostly dictated by state laws requiring a long-term shift to cleaner renewable energy sources. They also question whether local governments have the necessary expertise for the responsibilities they are taking on.

But since the state’s first CCA, Marin Clean Energy, was launched in Marin County in 2010, the programs have proven popular and kept expanding. Nineteen programs serving 10 million of the state’s 40 million residents have been established.

Last week, however, saw the first major bad news for CCAs in years. The Ventura County Star reported some of the local governments in California’s largest CCA – the Clean Power Alliance – were unhappy enough with the cost of power for street, highway and outdoor lighting that they had opted to return to Southern California Edison to provide that power.

The backlash is limited. The alliance includes Los Angeles County, Ventura County and 30 local cities. The cities of Ventura, Camarillo, Moorpark, Oxnard and Thousand Oaks have taken steps to limit their reliance on the alliance, and at least two other cities are considering the same step. They must give six months notice. 

Edison blamed for defections from Clean Power Alliance

Most member agencies are satisfied, with many choosing to use the 100 percent clean energy option provided by the alliance even if it carries a cost premium of 7 percent to 9 percent. 

Alliance leaders blame the defections on pricing decisions by Edison that they say were attempts to punish their CCA’s members. Edison said all its decisions had been ratified by the state Public Utilities Commission in a transparent process and challenged claims that the utility subsidized some customers at the expense of others.

But as cities are squeezed by the cost of pensions and look to save money wherever they can, the decisions made by Ventura, Camarillo, Moorpark, Oxnard and Thousand Oaks could be copied by other local governments. And while the cities are retaining use of the Ventura-L.A. CCA for most of their energy accounts, the street, highway and outdoor lighting accounts are among the biggest of all in terms of total bills, and thus most coveted by CCAs. 

Nevertheless, the news continues to be mostly bright for CCAs. In February, the San Diego City Council voted to begin negotiating on establishing a CCA with other local governments. San Diego would be the largest city in the nation with a CCA. The cities of Carlsbad, Chula Vista, Del Mar, Encinitas, La Mesa and Oceanside have expressed interest in joining the regional initiative.

Large utilities split on how to deal with CCAs

The decision was made easier by the surprising decision of the giant investor-owned San Diego Gas & Electric utility to welcome a new era in which it runs the regional grid but others choose energy sources. The utility disclosed in November that it hoped for state legislation “that would allow us to begin planning a glide path out the energy procurement space.” Edison and Pacific Gas & Electric have been far cooler to the CCA movement.

In another sign of CCAs’ acceptance as part of the California energy landscape, in May, Moody’s gave Peninsula Clean Energy an investment-grade credit rating. Peninsula serves 300,000 accounts in the Bay Area.

Only one other CCA has such a high rating from Moody’s: the Marin program that launched the movement in 2010. It has about 255,000 customers.

Gov. Gavin Newsom wants the Legislature to agree to sweeping reforms in wildfire liability rules by July 12, before lawmakers start a one-month recess.

After first calling on legislative leaders to shape new policies to help investor-owned utilities deal with a hotter, drier, more fire-prone era in April, Newsom put forward his own plan last week. It’s most significant change is an end to the state’s unusual “inverse condemnation” law that requires utilities be held liable for damages if their equipment sparks wildfires whatever the circumstances. Like predecessor Jerry Brown, Newsom thinks a more reasonable rule is to allow utilities to escape liability if there is evidence that their equipment was properly maintained – a standard used in most other states.

Newsom says this rule and the establishment of a $21 billion fund to help cover the cost of future blazes – paid for equally by shareholders and ratepayers of Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric – would go a long way toward stabilizing the state’s power grid and helping PG&E out of bankruptcy.

Thanks to a quirk, ratepayers might not even notice their share of the tab. That’s because a $2.50 monthly surcharge first imposed on utilities’ customers in 2002 to deal with heavy costs from the 2000-2001 energy crisis that is supposed to end next year would be renewed through 2035 to pay ratepayers’ share of the wildfire fund.

Brown’s call for weaker liability rules was rejected

But Brown got nowhere with his call last year to end “inverse condemnation.” And Newsom will face the same obstacles – and a new one. That’s the fact that many lawmakers may be ambivalent at best about helping PG&E come out of the bankruptcy process it initiated in January over at least $30 billion in claims from harsh wildfires in Northern California in recent years. 

The reputation of the state’s largest utility has been in a free-fall since a 2010 gas pipeline explosion in San Bruno that killed eight people and led to PG&E’s conviction of six federal felonies for shoddy maintenance and interfering with federal investigators. 

Yet after the utility promised it would do a far better job in inspecting and maintaining gas transmission lines, in December, the California Public Utilities Commission revealed that it had found that PG&E managers pressured workers to falsify “tens of thousands” gas safety inspections from 2012-2017.

The revelations stunned CPUC President Michael Picker – leading him to suggest for the first time that PG&E be taken over by the state, be broken up into smaller parts or otherwise go through a radical overhaul. 

The view that PG&E status quo must end has been highly popular among Bay Area politicians, who cite the fact that Sacramento started up its own municipal utility nearly a century ago in response to poor, costly service from PG&E.

In May, San Francisco Mayor London Breed said the city was preparing a formal, multibillion-dollar offer for some of PG&E’s key assets. Breed said her city had a “unique opportunity” to bolster its “long-term interest.”

Help PG&E with bankruptcy? Or break it up?

State lawmakers from the Bay Area include some of PG&E’s most forceful critics, starting with Sen. Jerry Hill, D-San Mateo. Even before the revelation in December about PG&E’s years of falsifying gas inspection records, Hill had already called for the utility to be taken over by a public agency or coalition of agencies.

Hill and other lawmakers are unlikely to accept changes in “inverse condemnation” until PG&E is overhauled. One of the main reasons previous calls to change the rule have been opposed was because of concerns that letting up pressure on PG&E to meet safety standards would lead the utility to be reactive instead of proactive in maintaining its equipment.

Against this backdrop, Newsom’s push to get his fire relief plan approved by July 12 doesn’t appear realistic.

Proponents say government control will lead to cheaper utility rates and faster adoption of renewable energy.

This month, more than 950,000 homes and businesses in Los Angeles and Ventura will shift to a community-choice program – the Clean Power Alliance. It will be the state’s 20th and largest community-choice provider, which will then provide power to nearly 3.6 million customers in the Golden State.

Those numbers could drastically grow in coming years. Both San Diego Mayor Kevin Faulconer and Dianne Jacob, chair of the San Diego County Board of Supervisors, have endorsed community-choice programs. Many other local governments are watching how the programs work in places that have already adopted them.

SDG&E says it welcomes infrastructure-only role

To the surprise of many industry watchers, one of the state’s three giant investor-owned utilities isn’t fighting this development.

After San Diego began taking steps toward a community-choice program last year, San Diego Gas & Electric made clear its interest in getting out of energy procurement. Earlier this month, Kendall Helm, SDG&E’s vice president of energy supply, told the Los Angeles Times that the decision was straightforward.

“We don’t think we should be signing big, long-term contracts for customers that have made a conscious choice to be served by a different” provider, Helm said. “We think our primary role and our primary value is in the safe and reliable delivery of that power.”

Pacific Gas & Electric and Southern California Edison continue to defend the status quo and to work with the California Public Utilities Commission and SDG&E on “exit fees” assessed to departing customers to make sure they help pay for maintaining energy infrastructure. But PG&E, now in bankruptcy and facing possible dissolution by the CPUC because of repeated scandals, has dropped its once-aggressive opposition to the very idea of community-choice energy, including sponsoring a failed state ballot measure on the issue in 2010.

CPUC president fears programs could fail, cause havoc

But California’s most prominent regulator worries that adoption of community-choice’s programs could have huge unintended consequences.

CPUC President Michael Picker told the San Francisco Chronicle last spring that he worries about things going haywire.

“You’re going to have some failures,” Picker said. “Electric markets can be brutal. So what happens to the customers, midyear, if the company or the program goes away? Where do those customers go?”

In a May op-ed in the Sacramento Bee, Picker urged local officials pursuing community-choice to act with care.

“The last time California deregulated electricity, it did so with a plan, however flawed. Now, electricity is being deregulated de facto, through dozens of decisions and legislative actions, without a clear or coordinated plan,” he wrote. “If California policymakers are not careful, we could drift slowly back into another predicament like the energy crisis of 2001.”

Picker warns that managing California’s power grid requires expertise and will become increasingly difficult as new clean-energy mandates kick in and as new technologies come to the fore.

But these warnings so far don’t seem to resonate with the statewide business community, which so far has not taken a strong, consistent stand on community-choice.

Some local groups have, however. The San Diego Regional Chamber of Commerce, for example, questions the assumptions that community-choice will lead to cheaper utility rates and increased use of clean energy.

A California Public Utilities Commission report that Pacific Gas & Electric failed to fulfill its responsibilities to properly maintain

On Dec. 21, the CPUC released a dramatic statement saying it would consider drastic steps to address the “serious safety problems” it says the utility has long condoned. The commission said a break-up of the agency into smaller regional utilities or a state takeover would be among the possible changes it examined.

“This process will be like repairing a jetliner while it’s in flight. Crashing a plane to make it safer isn’t good for the passengers,” said CPUC President Michael Picker. “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.”

CPUC looking at seven possible major changes

The CPUC statement said seven possible changes would be considered.

– Having “some or all of PG&E be reconstituted as a publicly owned utility or utilities.”

– Replacing some members of PG&E’s Board of Directors with members “with a stronger background and focus on safety.” 

– The replacement of existing corporate management.

– Adoption of a new corporate management structure with regional leaders overseeing regional subsidiaries.

– Linking PG&E’s “return on equity” – the profits it shares with its investor-owners – to its safety performance.

– Breaking the utility’s natural gas operations and its electric transmission operations into separate companies.

– Ending the arrangement in which PG&E is controlled by a holding company so it becomes “exclusively a regulated utility.”

Picker’s statement was a remarkable turnaround from his comments on Nov. 15, when his upbeat remarks about the ability of PG&E to survive its fourth consecutive year of devastating wildfires in Northern California led the utility’s stock price to spike.

It reflected the anger among CPUC officials over a staff report released Dec. 14 that found the utility had systematically neglected natural gas infrastructure despite being fined $1.6 billion and convicted of six felonies in federal court over the 2010 disaster in San Bruno, a suburb of San Francisco.

Utility facing 500 lawsuits relating to fires it may have caused

Even if PG&E survives in something like its present form after the CPUC’s review, its future is still very cloudy.

Because of claims that PG&E was responsible for the devastating Camp Fire that killed 85 people in Butte County in November, U.S. District Judge William Alsup announced he was reviewing whether PG&E had violated terms of its federal probation in the San Bruno case.

PG&E also disclosed to the U.S. Securities and Exchange Commission that it is facing roughly 500 lawsuits with more than 3,100 plaintiffs over claims the utility was responsible for many of the dozens of wildfires in Northern California since 2016.

It is also facing wildfire-related lawsuits from the state Office of Emergency Services, Cal Fire, Calaveras County and other government agencies.

But while the CPUC is apparently ready for major changes at the utility, it’s not clear yet how state lawmakers feel.

On Nov. 19 – even as criticism of PG&E swelled as confirmed deaths grew in the Camp Fire – Assemblyman Chris Holden, D-Pasadena, was reported to be considering introducing legislation to help the utility deal with wildfire costs.

Holden helped pass a law earlier this year that allowed PG&E to spread out the costs from the liabilities it faced from 17 wildfires in 2017.

Pacific Gas & Electric – the giant investor-owned utility that serves 16 million Californians – appears to be facing its gravest crisis since its founding in 1905.

The initial indications that PG&E’s equipment may have sparked the Camp Fire that killed at least 88 people in Butte County – the deadliest blaze in state history – initially led at least some state lawmakers to consider new legislation to try to insulate PG&E from potentially devastating liabilities. Earlier this year, the Legislature passed and Gov. Jerry Brown signed into law a measure that lets PG&E spread out the costs from 17 Northern California wildfires in 2017 and have its customers pay some of its bills.

The Bloomberg news service reported that Assemblyman Chris Holden, D-Pasadena, may introduce legislation to help PG&E in coming days.

But a federal judge and the president of the California Public Utilities Commission have shaken PG&E’s hopes that it can avoid crushing new blows.

Judge demands answers on PG&E, Camp Fire

U.S. District Judge William Alsup has ordered PG&E to provide evidence proving its negligence didn’t cause the Camp Fire – raising the prospect that the utility could be found guilty of violating the terms of its five-year criminal probation that began in January 2017.

The probation was imposed then by U.S. District Judge Thelton Henderson – along with the maximum possible fine of $3 million – after PG&E was convicted of six felonies related to the 2010 San Bruno disaster (pictured above). A PG&E natural gas pipeline that was found to have been poorly maintained exploded, killing eight, injuring more than 50 and wiping out 38 homes. The utility was convicted of five felonies for failing to keep the pipeline safe and a sixth felony for impeding investigators.

Judge Alsup was assigned to monitor PG&E’s probation. In a statement, Alsup said his goal was determining what “federal, state or local crimes might be implicated were any wildfire started by reckless operation or abandonment of PG&E power lines” or “inaccurate, slow or failed reporting of information about any wildfire.” If Alsup concludes that PG&E violated its probation, the utility could face unprecedented punishment from the judge.

Two days after Alsup’s announcement, CPUC President Michael Picker said he had concerns about whether PG&E’s “culture” had enough of a commitment to public safety. At a CPUC board meeting in San Francisco, the utility was ordered to implement 60 safety recommendations from a commission consultant.

Picker’s critique came less than two weeks after he stuck up for PG&E, challenging the idea that the Camp fire could or should put the utility into bankruptcy. “It’s just not good policy,” Picker told the San Francisco Chronicle. “It doesn’t work out.” This stabilized PG&E’s stock price.

The new tone from Picker was a departure from the normally close relationship between the CPUC and PG&E.

Those who have called for the CPUC to be reformed and to be much tougher with the utilities it oversees often cite the $1.6 billion “fine” the utility commission levied in 2016 on PG&E for the San Bruno disaster. More than half of the fine – $850 million – was actually a requirement that the utility upgrade its natural gas pipeline system.

Critics said this amounted to likening the improvements that PG&E had to make to a penalty.

Picker joined in the 4-0 CPUC board vote for the “fine.”

How much of wildfire costs not covered by insurance should be paid by California’s giant investor-owner utilities has been a significant issue since at least 2007. That’s when wildfires ravaged northern and eastern San Diego County, killing two people and destroying more than 1,300 homes.

San Diego Gas & Electric argued that it should be allowed to pass on $379 million in related costs. But the California Public Utilities Commission and state courts – noting the evidence that poorly maintained equipment had been blamed for much of the damage in two state investigations – have rebuffed SDG&E. The utility’s most recent setback came just last week when the state 4th District Court of Appeal in San Diego rejected a call to overturn previous rulings.

But during SDG&E’s long fight for a utility-favorable interpretation of liability laws, the debate has become far more high-profile. With six of California’s all-time 10 worst wildfires occurring since September 2015 in areas served by Pacific Gas & Electric and Southern California Edison, the question of what to do to keep the state’s two largest investor-owned utilities in business has emerged as one of the thorniest, most contentious issues in Sacramento.

Now, with Northern California reeling from its deadliest fire ever in Butte County, and with a large area of Ventura County and northwest Los Angeles County ravaged in the past two weeks, PG&E and Edison are confronted with a perverse twist on their successful efforts to get the Legislature to give them relief from huge wildfire costs.

Law protecting utilities doesn’t take effect until Jan. 1

Senate Bill 901 – the main measure passed in late summer to insulate utilities from the extreme costs of fires – doesn’t take effect until Jan. 1. That means its provisions to limit utilities’ liabilities if it could be shown they properly maintained their equipment in fire-prone wilderness areas won’t help PG&E or Edison with this fall’s blazes.

Instead, the old standard that led to negative rulings against SDG&E will be used in assessing damages. Given that utilities’ equipment is blamed for helping start the latest round of wildfires, that could be apocalyptic for the finances of PG&E. As of Monday afternoon, the Camp Fire had killed 77, with nearly 1,000 people unaccounted for, and torched 151,000 acres and nearly 13,000 structures.

In the Woolsey fire northeast of Los Angeles, three people have died, while more than 96,000 acres and 1,400-plus structures have burned.

In coming days, the focus is likely to be on how many of the missing in the Camp Fire are dead. It could end up as one of the five deadliest natural disasters in the United States in this century – nearly as lethal as Hurricane Katrina.

But eventually the focus will return to whether PG&E can survive the latest conflagrations even as it deals with potential losses in the billions from previous fires – and how much more state lawmakers and Gov.-elect Gavin Newsom should do to help the utility survive in its present condition.

Its company valuation plunged by more than one-third after the severity of the Camp fire became evident, only to jump somewhat late last week after the president of the state Public Utilities Commission offered supportive comments.

“It’s not good policy to have utilities unable to finance the services and infrastructure the state of California needs,” Michael Picker told Bloomberg News. “They have to have stability and economic support to get the dollars they need right now.”

PG&E has filed for Chapter 11 bankruptcy before, in April 2001, when the utility was squeezed by sky-high energy costs after the blackouts of winter 2000-2001. It emerged from bankruptcy three years later.

Lawmakers have little goodwill for ‘criminal’ PG&E

But a huge scandal since then has left Northern California lawmakers with less goodwill toward the 113-year-old utility, whatever Picker’s views and whatever their willingness to pass SB901.

In 2010, a PG&E transmission line exploded in the San Francisco suburb of San Bruno, leaving eight dead and destroying 38 homes. In 2017, a federal judge found the utility guilty of five felonies for its failings to safely maintain the gas line, and a sixth felony for obstructing the National Transportation Safety Board’s investigation into the disaster.

Sen. Jerry Hill, D-San Mateo, routinely refers to PG&E as a “criminal” institution. Last week, he renewed his call to break up the utility, saying it could no longer be trusted to act in the interest of public safety.

PG&E shares closed at $23.26 in Monday trading. That was down 58 percent from its 52-week high of $55.66.

California’s three large investor-owned utilities are renewing efforts to allow them to make ratepayers cover the costs of wildfires that authorities blame on utilities’ mistakes or poor maintenance.

Pacific Gas & Electric officials made this clear last week when they announced they expected to have at least $2.5 billion in liabilities from the wildfires that scarred the wine country of Northern California last October. That sum is only for 12 relatively small blazes that the state blames on PG&E’s failure to maintain equipment and clear brush near power lines. Authorities are still looking at what caused the biggest blaze – the Tubbs fire – which torched more than 3,000 homes in Sonoma County and is blamed in the deaths of 22 people.

PG&E CEO-President Geisha Williams used a conference call with analysts to make the case for state legislation to protect electricity utilities from bankruptcy in an era in which huge wildfires – blamed on hotter, drier weather – are more common than ever. PG&E only has an estimated $840 million in insurance coverage to deal with the 200 and counting lawsuits from the wine country conflagrations.

Williams said “flawed” state laws made utilities responsible for fire risks that were beyond their control. But in a decision-making process that began last summer – before the wine country blazes – and ended after they were finally put out, the California Public Utilities Commission rejected a similar argument put forward by San Diego Gas & Electric. In August, CPUC staff recommended that commissioners reject an SDG&E request to pass along to ratepayers $379 million in unrecovered costs from 2007 wildfires that ravaged San Diego County. After three months of wavering, the CPUC board voted unanimously in late November to deny the request.

Williams said negative media coverage of the October fires complicated utilities’ efforts to get help from the California Legislature. But some utility watchdogs are still wary of state lawmakers, whom they see as sending out mixed signals on wildfire liabilities.

On the one hand, the state Senate voted 39-0 in May and an Assembly committee voted 15-0 last week for Senate Bill 819. It would ban the CPUC from allowing utilities to pass along to ratepayers the costs of fines or penalties as well as the cost of damages that were “caused” by a utility’s infrastructure. Only costs the CPUC deems “just and reasonable” can be shifted from shareholders to ratepayers under the legislation. PG&E and Southern California Edison expressed “concerns” about the bill without formally opposing it, according to a legislative analysis.

Benign bill pushing responsibility – or stealth bailout?

But another bill that had similarly lopsided support in the Senate is drawing a very mixed response. Senate Bill 1088 passed the Senate 34-2 in late May and survived an Assembly committee vote last week with eight lawmakers in support, two in opposition and five declining to vote.

It would require utilities “to submit a safety, reliability and resiliency plan to the California Public Utilities Commission every two years.” It would also require the state Office of Emergency Services “to adopt standards for reducing risks from a major event and requires the office to update the standards at least once every two years.”

Supporters – including PG&E, SDG&E, labor unions and some counties hit hard by last year’s blazes – depict the measure as a benign attempt to make sure utilities are prepared to handle their responsibilities.

But critics see the language requiring the state to regularly “update” how it evaluates risks posed by the biggest blazes as potentially giving legal ammunition to the utilities – specifically, to their arguments that emerging, more dangerous conditions should change what costs can be shifted on a “fair and reasonable” basis to ratepayers.

Formal opponents of SB1088 include groups which have standing to challenge utilities’ proposed rate hikes (The Utility Reform Network and the Office of Ratepayer Advocates); business interests (the California Manufacturers and Technology Association, the Western States Petroleum Association and farm groups); and green activists (most notably the California Environmental Justice Alliance).

California’s three giant investor-owned utilities haven’t given up on hopes that state leaders and regulators may give their shareholders the financial protection they want in an era of frequent massive wildfires linked to climate change – and their hopes don’t seem as dim as they used to be.

In late November, the California Public Utilities Commission issued what syndicated columnist Thomas Elias called “perhaps its most consumer-friendly decision in several decades.” Affirming staff recommendations made in August, the CPUC board unanimously rejected a bid by San Diego Gas & Electric to pass along $379 million in unrecovered costs stemming from three blazes in 2007 that ravaged San Diego’s northeast suburbs, the city of Poway and unincorporated county areas, torching over 1,300 homes. The CPUC board noted that two independent investigations had concluded the fires were SDG&E’s fault because of poor maintenance practices in high-risk fire areas, and that utility shareholders – not ratepayers – should pay the bill.

But as the bureaucratic decision-making process played out in the San Diego case, the CPUC’s decision in the matter came to have immense importance to Pacific Gas & Electric because of what happened in its own back yard – the brutal October 2017 Wine Country wildfires (pictured). The cost of those Northern California blazes – about $10 billion – dwarfs the cost of San Diego County’s 2007 fires. PG&E’s liability exposure is also expected to be much higher than SDG&E’s – likely in the billions of dollars, according to reports that have regularly blamed PG&E wildfire management practices for the conflagrations, which left more than 40 dead.

PG&E, SDG&E and Southern California Edison officials see the CPUC ruling as a potential existential threat in a hotter, drier era and weren’t ready to let it stand as the final word. This led to what seemed like a long-shot January appeal by the three utilities seeking a new CPUC hearing for SDG&E’s bid for $379 million in relief.

It may not be as long a shot any longer. Gov. Jerry Brown issued a pronouncement March 13 mostly devoted to new efforts to minimize wildfire risk. But its passing reference to the governor’s interest in new legislation that would “update liability rules and regulations for utility services in light of changing climate” conditions caught the eye of Wall Street, at least.

PG&E stock price jumps on report from governor’s office

Barron’s gave PG&E its “hot stock” appellation after the utility’s stock price jumped 6.3 percent on March 13, to $45.10. As of the end of trading Friday, the price was down to $43.08. But that was still up more than 20 percent from its mid-February low.

Ultimately, the question of whether the utilities will get help from the California Legislature and the CPUC seems certain to become a huge political football. The governor has long been seen as close to the three utilities, vetoing reform bills related to recent scandals that have easily passed the Assembly and Senate in recent years.

But Brown is termed out and in his final eight-plus months on the job. With California Democratic politics seeming to have entered an intensely populist phase, leading candidates to replace Brown such as Lt. Gov. Gavin Newsom and former Los Angeles Mayor Antonio Villaraigosa may hesitate to back rule changes that can be depicted as insulating the utilities from the costs of their poor practices in addressing wildfire risks.

Several state legislators are determined to head off any lessening of utilities’ liabilities for their mistakes. In January, Sen. Jerry Hill, D-San Mateo, and seven co-sponsors in the Senate and Assembly introduced Senate Bill 819. Hill called it an “outrage” that state utilities wanted to make their customers pay for damages that “result from negligent practices.”

An April 17 hearing has been scheduled for the legislation.

Pacific Gas & Electric and its shareholders could face a huge financial blow from this month’s massive wildfires in the wine country of Northern California – unless they can get the state Public Utilities Commission to overturn a recent precedent-setting ruling made by its staff involving disastrous wildfires in 2007 in San Diego County. The PUC apparently is taking the request seriously, putting off a decision on whether to uphold the ruling.

The Bay Area News Group reported on Oct. 10 that Sonoma County fire dispatchers received many calls about downed PG&E power lines and exploding electrical transformers the night of Oct. 8, when fast-spreading fires began that eventually killed 42 people, incinerated nearly 9,000 structures and burned more than 245,000 acres. Cal Fire and the PUC are investigating whether PG&E is partly or entirely responsible for the inferno because it failed to trim trees near power lines, as is required by state law.

Now the Bay Area News Group is reporting that PG&E officials are pleading with the PUC to be able to shift the cost of such disasters to ratepayers even if a utility is to blame. PG&E faces billions of dollars in claims from this month’s fires but says it only has $800 million in insurance.

A PG&E official told PUC staffers that the state’s three giant investor-owned utilities – PG&E, Southern California Edison and San Diego Gas & Electric – have been put in an “untenable situation” because of growing wildfire risks and a tough insurance market.

PUC judges said SDG&E couldn’t escape $379 million in wildfire costs

But two months ago, two PUC administrative law judges – S. Pat Tsen and Sasha Goldberg – rejected a request for $379 million in relief from SDG&E in a case with parallels to PG&E’s situation. The ruling dealt with three 2007 fires in San Diego County that killed two people, destroyed 1,300-plus homes and charred more than 206,000 acres.

Based on evidence gathered by Cal Fire and PUC investigators, the judges concluded that SDG&E was responsible for the fires because of failure to do adequate tree trimming near a power line and because of slow responses to equipment malfunctions. The judges also rejected claims that excessive winds that couldn’t have been expected were responsible – a claim PG&E is making about this month’s fires despite evidence to the contrary.

Because of these circumstances, the judges said it would be improper to ask SDG&E ratepayers to cover the $379 million in costs that the utility had to pay after settling billions of dollars in claims and getting reimbursed by its insurers.

Suggesting it might have some sympathy for both PG&E and SDG&E, the PUC on Thursday again put off a vote on whether to ratify the administrative law judges’ decision.

PG&E’s call to let it shift disaster costs to ratepayers was immediately slammed by consumer groups – and not just because they saw this as the utility trying to duck responsibility for this month’s massive fire. They warned it would lead the state’s three large utilities to cut back on wildfire safety efforts, knowing they wouldn’t be held responsible for their lax efforts.

Fears that PG&E already does an inadequate job were bolstered Tuesday by the San Francisco Chronicle’s report that over a recent five-year span, PG&E missed the deadlines to complete more than 3,500 work orders in Sonoma County, many of which were safety-related.

With roots dating back to 1852, PG&E is an iconic California company that has endured its share of hard times, including going into Chapter 11 bankruptcy from 2001-2004 because of huge losses during the 2000-2001 state energy crisis.

But 2017 is shaping up as the 112-year-old utility’s most fraught year ever. On Jan. 26, a federal judge found PG&E guilty of five felonies for its failings in preventing a 2010 explosion of its gas line in San Bruno, a suburb of San Francisco, and a sixth felony for obstructing the National Transportation Safety Board’s official inquiry into the disaster. Judge Thelton Henderson leveled the maximum fine possible of $3 million.

Eight people were killed and 38 homes were destroyed in the San Bruno explosion and fire, which led to a record $1.6 billion PUC fine in 2015.

From pioneering air-pollution control programs in Los Angeles County in

So when Senate President Pro Tem Kevin de León introduced Senate Bill 100 in January, the expectations were high. The measure committed California to generating 50 percent of electricity from renewable sources by 2026 – four years earlier than the present goal – and to 60 percent by 2030 and to 100 percent by 2045. No government remotely as large as California’s had made such a commitment.

In spring interviews with reporters at an energy conference in Orange County, the Los Angeles Democrat depicted his bill as a common-sense measure to goad investor-owned utilities into making long-term shifts in their infrastructure to prepare for an all-renewable future. He said progress had been so quick that he expected the state to meet the 50 percent renewable standard “in the early 2020s without breaking a sweat.” But he also depicted SB100 as setting up “the most ambitious program in the world.”

When it passed the California Senate on a mostly party-line vote in May, the world took notice. The New York Times set the tone: In a 2,100-word analysis headlined “Fighting Trump on Climate, California Becomes a Global Force,” it depicted the bill as a key part of California’s determination to take over the global lead in environmentalism from Washington.

But earlier this month, SB100 failed to even get a floor vote in the Assembly as lawmakers wrapped up business for the year. A Desert Sun report depicted the decision as “unexpected.”

That’s not how it looked to some insiders. Business groups spent months hammering home the argument that it was risky to commit to 100 percent renewable energy use when it was not clear that was either feasible or safe for a modern economy. In a June interview with the San Diego Union-Tribune, Gary Ackerman, executive director of the Western Power Trading Forum, depicted SB100 as “reckless” and with a huge downside. The arguments echoed those made by Pacific Gas & Electric, Edison and San Diego Gas & Electric, the state’s three giant investor-owner utilities, which quietly have established strong ties with Democratic lawmakers in poor districts buffeted by high energy costs.

IBEW adopted, modified utilities’ argument

Meanwhile, de León didn’t enjoy unified support on the Democratic front. An argument the utilities had been making – that SB100 was potentially a hugely disruptive force – was adopted and modified by some labor leaders. They worried what a 100 percent commitment to renewable energy might mean for thousands of union members. According to an NBC News report, the International Brotherhood of Electrical Workers, Local 1245, began opposing the bill in late summer because the local union alleged de León had gone back on his promise to protect union jobs.

But a third factor may also have been at play. De León has never enjoyed the broad goodwill accorded his predecessor, Darrell Steinberg, now the mayor of Sacramento. Soon after taking over as Senate leader in late 2014, de León was the target of a scathing column by then-Sacramento Bee pundit Dan Walters for mistakes, power plays and a lack of humility. He faced similar criticism from the Sacramento Bee’s editorial board.

De León has since emerged as a legislative powerhouse, at least according to the conventional wisdom that holds that the 2017 session was one of the most productive in recent history. But his clout couldn’t overcome the late-emerging opposition to SB100.

The lobbying will begin all over again for the measure in January, the Greentech website reported.

“We’re going to be back next year,” said Peter Miller, Western energy project director at the Natural Resources Defense Council, told the website. “I don’t want to underestimate the challenges to moving to a fully zero-carbon grid, but we can get there, and we will.”