San Francisco Offers $2.5BIL For PG&E Electric Grid
San Francisco city officials are offering to purchase PG&E's electrical grid in the city for $2.5 billion, according to a letter sent to the utility on Friday by Mayor London Breed and City Attorney Dennis Herrera.
Sonja Hutson, September 8, 2019 (KQED News)
“…[San Francisco’s offer of $2.5 billion] for the PG&E equipment would come from bonds approved by voters in June 2018, and would be paid off by customers through their electric bill…[The bond issuance would allow rates to] be the same or lower than current PG&E rates…The city is also hoping the company's bankruptcy proceedings will provide additional incentive to accept the offer, by providing ‘significant cash infusion’ to debtors…[ The deal would require approval from the city’s Board of Supervisors, Public Utilities Commission, and the California Public Utilities Commission. But PG&E doesn't see municipalization as in the best interests of] customers and stakeholders…
Another potential barrier is pushback from the union representing PG&E workers, IBEW Local 1245. The city has offered to hire people who worked for PG&E in San Francisco if the deal goes through, which the union said would hurt their pensions…According to Michael Wara, an energy policy researcher at Stanford University, private energy companies hardly ever voluntarily sell their infrastructure to municipalities. More often, municipalities will forcibly take over the infrastructure by exerting eminent domain, and then pay the utility for it…[That] process could drag out the utility's bankruptcy proceedings because the sale would have to be final in order for the bankruptcy to be resolved. It could also delay payouts to victims of wildfires started by PG&E equipment…San Francisco is such a huge part of PG&E's customer base, according to Wara, the utility might not be a viable company without it.”click here for more