PG&E Drops California Investments because of Wildfire Costs

California Governor Gavin Newsom tried in vain to get the Legislature to ease the financial burden public utilities are suffering because of wildfires their equipment causes.

He wanted insurers, lawyers and consumers to bear most of the burden.

Now PG&E says it’s going to cut 2027 investments by about $2 billion. The utility said the cuts will be for projects that can be postponed and not for work on the agreed upon wildfire safety projects. The financial burden of the state’s wildfire-liability rules are the listed reason for the delays.

PG&E emphasizes the announced cuts have nothing to do with the defeat of Newsom’s plan and decisions by the Legislature to leave much of the financial responsibility with the utilities.

California Democratic Party leaders are skeptical of the reason.

Assemblywoman Cottie Petrie-Norris heads the Assembly’s Utilities and Energy Committee. She said utilities have to borrow to finance construction costs and in California, those utilities pay higher borrowing costs than utilities in other states.

“With utilities, like any company, in order to build stuff, they’ve got to borrow money,” Petrie-Norris said. “Much like you and I, when we’ve got a mortgage, if our credit rating isn’t good, it costs us more money. And when it costs PG&E or any of the utilities more money to build and construct utility projects, that’s a bill that gets passed on to all of us, and that’s not OK.”

She said the spending cuts will likely affect work on poles, wires, sensors and other critical, wildfire prevention projects. That’s a worry.

“That’s also not OK. So that’s why I’m concerned, and that’s why it matters for all of us,” she said.

Petrie-Norris said in the end, the battle between the utilities and California’s government doesn’t matter. What really counts is how it affects the consumer.

“When two elephants are fighting, it’s the grass that suffers,” Petrie-Norris said. “We don’t care about your companies. We don’t care about your industry. We care about what you are doing for Californians.”

Source link: New York Post — https://bit.ly/4qYFNLY