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Constructive criticism: PG&E holds NorCal economy hostage

There is a side to the ongoing PG&E horror story that gets no ink.

The reason is simple. It involves groups of “victims” that don’t draw much sympathy due to the rampant disease of political correctness. The victims are businesses, farmers, corporations, developers, and government agencies.

And what PG&E has done to them for decades should be the final nail in the coffin for the for-profit utility that is really a state protected and propped up monopoly.

PG&E’s understaffed construction division has cost farmers, businesses, developers, and even the City of Manteca tons of money just in the past year alone.

What happens is an entity will schedule a time with PG&E — plus write a hefty deposit check upfront — for PG&E work critical to a construction project.

Often times PG&E fails to honor the commitment despite it often being scheduled months in advance. Most who know how unreliable PG&E can be have taken to stretching construction timelines knowing you can’t always count on the for-profit utility.

But even building in assumptions that PG&E will not honor scheduling commitments, those with major construction investments still get zapped in the pocketbook due to delays in work.

Ask Leo DeGroot who built a commercial complex that he couldn’t rent for months while he waited for PG&E to honor its commitment secured with a hefty deposit check. Ask farmers like Dave Phippen that nearly a year out due to harvest needs scheduled and secured PG&E work with a significant deposit only to find out PG&E couldn’t do the work in the time frame promised.

PG&E’s scheduling problems even delayed public works projects such as the opening of the Atherton Drive gap between Union Road and Airport Way in Manteca.

Great Wolf also had to wait on PG&E to do work they promised to do on a specific date. These are not just delays of a couple of days. They run into weeks and months and more often than not effectively slowdown or stop other components of a project. Delays cost money. But what does PG&E care? They’ve got a monopoly thanks to friends in Sacramento who carry their water and help them wiggle their way out of messes that PG&E creates as it stumbles from one disaster to another.

Those delays ultimately cost consumers, businesses, and taxpayers more money.

Is anyone surprised PG&E is in bankruptcy, is paying bonuses after the company was steered into the rocks, stands accused essentially of mass murder of customers due to less than stellar safety oversight, and has obliterated whole neighborhoods? This is simply a repeat of the “Old PG&E” from 7 to 15 years ago. The only difference today is the “New PG&E” has become much more effective. Instead of killing off 8 ratepayers this time around the body count is 86. No longer are they dealing with small numbers when it comes to destroying homes. The 35 homes they destroyed in San Bruno were small potatoes compared to the 14,000 they wiped out in Butte County. They’ve even managed to outdo themselves in the debt load that poor company management created that sent them into bankruptcy court again. Even the post-disaster performance is tracking the same although the bonuses were a bit more robust, the apology a bit more unbelievable, the immediate rate hike to get them “back on their feet steeper, and their promise to be a better company going forward a lot more hollow.

Maybe the “New & Improved PG&E” that will roll out of bankruptcy court this time will strive to reach new heights. Instead of taking out a town the size of Paradise they can set their sights on bigger challenges such as leveling places like San Jose, getting the kill numbers into the triple digits, and blow through money faster than the federal government while paying even fatter bonuses.

What PG&E has done to Northern California’s economy via endless construction work delays is worthy of pulling the plug and breaking the company up by itself, let alone the wanton destruction of property and lives.

The construction charges are completely different than the rate cases. As such you’d think PG&E would staff accordingly given the fact the work is being paid for by those who need it done.

Could it be PG&E is deliberately understaffing its construction division to pad its profits? The Manteca area examples of PG&E foot dragging have occurred in both good and bad economic times.

It is made worse by the fact developers for subdivisions are slapped a hefty surcharge that is supposed to cover PG&E taxes for equipment that developers pay to put in the ground so PG&E can make money by selling electricity and natural gas to homeowners.

The slick part is PG&E pockets whatever isn’t needed for taxes instead of refunding it to the developer. And in a number of years where PG&E has taken advantage of tax credits they successfully lobbied to attain for the expressed purpose of investing in infrastructure upgrades which they apparently weren’t doing on the scale they led people — including regulators — to believe, they pocketed the surcharge that can run as high as 33 percent that the California Public Utilities Commission allows them to collect to cover their tax bill.

This is why Wall Street investors are knocking each other over in a bid to get in on the action by investing upwards of $30 billion into PG&E to get them off the bankruptcy ropes.

Thinking the outcome will be different this time around especially since investors are pushing for a 16 percent guaranteed return as opposed to the current 10.5 percent profit PG&E can count on regardless of how much they once over 16 million customers is akin to believing if you give a meth head a choice between smoking meth or mainlining meth that their behavior will change for the better.

Given PG&E’s less than stellar track record with construction services, how their handiwork has jacked up fire insurance premiums across the north state, their admission their faulty and aging equipment started a fire that killed 86 people and destroyed 14,000 homes, and a host of other transgressions you’d think folks in Sacramento would move to de-fang PG&E before they get a chance to hammer Northern California into Third World economic status.

Their job as a for-profit utility isn’t to play patty cake. It’s to make money.

Keep that in mind when PG&E deliberately cuts off power to save the firm from wildfire liability. Sure the politicians in Sacramento will huff and puff but they won’t blow the PG&E house of cards down.

This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at or 209.249.3519.