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PG&E ratepayers’ $2B Question: What did they do with money?
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More than a dozen people spoke to the pair of administrative law judges on Tuesday afternoon in Stockton that are handling PG&E’s general rate case request to increase customer bills in order to pay for the community wildfire safety program, liability insurance, and core gas and electric operations over the next three years.

And while an estimated increase to bills of $10 every month – which would increase to an estimated $20-a-month in 2022 – was a sticking point for everyone who voiced their opposition, a common question emerged as well. 

If rate increases have been a steady part of PG&E’s business model over the last several years, where did the money for things like tree maintenance and liability insurance go if not to prevent the kind of deadly wildfires that destroyed the Northern California community of Paradise?

Inside of the auditorium of the State of California building in Downtown Stockton, the two administrative law judges for the California Public Utilities Commission – Rafael Lirag and Elaine Lau – heard from residents from throughout the region that took issue with footing the bill for a program that they claim should already have been in place. 

Connor Gorman, a graduate student from UC Davis who drove to Stockton to voice his opposition to the proposal, noted that the investor-owned utility model is something that contributes to the ongoing increases as it makes the company beholden to shareholders rather than the ratepayers who keep them in business – relying on the fact that CPUC will approve their generate rate case requests regardless of the amount of opposition. 

“Public utilities should be controlled by the public,” Gorman said. “They should be run in a way that benefits the entire community and not just a set of shareholders.”

One speaker, who represented a number of businesses that perform canning operations during California’s summer season – businesses that operate around-the-clock for up to 100 days during harvest – said that the discrepancy between what one of his companies pays for power inside of PG&E’s coverage area when compared to a plant in Oregon amounts to a 275 percent difference. Examining that company’s power bills from 2009 when compared to today, he said, show that they’re paying at least twice as much for their utilities and in many respects are getting a reduced level of service in exchange. 

And one speaker, Tim Dean, pointed out that even the estimated increase in monthly bills distorts what the true cost of the rate increase will actually be – the nearly $11 increase, Dean noted, was based on the usage of 500 kilowatt-hours of electricity every month which will be low for single-family homes in the Central Valley that rely on air conditioning units to get through the scorching summer months. 

According to the proposal that PG&E submitted to the CPUC, the company is asking for a $134 million increase to 2020 revenue above current total revenues (2.9 percent) and a $924 million increase to 2020 revenues (6.8 percent) – a combined $1.05 billion increase for the next fiscal year. 

Those numbers would only increase in the following two years as well, with a proposed increase of $121 million and $122 million, respectively, for gas in 2021 and 2022, and $333 million and $364 million for electricity in 2021 and 2022 – a total of more than $930 million on top of the 2020 total increase. 

In a statement read before the public was given the chance to provide testimony, PG&E Vice President of Energy Procurement and Policy Roy Kuga said that the proposed increases will not be used to pay for the wildfire liabilities that were incurred in Paradise, or be used to pay for executive compensation. 

Wednesday’s hearing – which was held during the middle of the day and again during the evening to allow for residents who work to voice their concerns – came one week after the Wall Street Journal reported that PG&E knew for years that hundreds of miles of its high voltage power lines were outdated and could fail and spark fires, but failed to do anything about it – delaying the much-needed work even as California went through its worst drought on record and conditions in the mountain and foothill areas where the transmission lines and aging towers are located reached tinderbox proportions. 

To contact reporter Jason Campbell email or call 209.249.3544.