Pacific Gas & Electric, showing its determination to overcome a history of safety issues, announced Wednesday that it plans to bury 10,000 miles of its power lines to prevent the kind of forest fires that led the utility to bankruptcy.
The project, which would affect about 10 percent of the current overhead lines, could cost tens of billions of dollars. The announcement sparked questions from longtime critics of the utility as to how much of the cost would be borne by installment payers rather than shareholders.
The company, California's largest electricity company, said the work would initially target the most fire-prone areas and expand to its coverage area, which includes 5.5 million electricity customers in northern and central California.
PG & E's announcement came days after a preliminary report to state regulators said its equipment may have caused the Dixie Fire, one of the largest fires in the state that burned at least 85,000 acres. The fire spreads in Butte County, where utility equipment caused a fire that destroyed the town of Paradise and killed 85 people in 2018.
Although utilities across the country have increasingly buried their power lines, none have proposed a project on the scale of PG & E's plan. The utility currently has 27,000 miles of underground power lines, but these are generally not located in areas of high forest fire risk.
“You need to know that we are working day and night to solve this incredible problem,” said Patricia K. Poppe, general manager of PG&E Corporation, the utility's parent company.
This year the company is laying 70 miles of pipeline underground, so increasing the work to 1,000 miles per year would be a leap. “That's the moon shot,” said Ms. Poppe when he called reporters. “It should be a shocking number because it's a big goal.”
By comparison, President Biden's infrastructure proposal calls for $ 73 billion to improve the country's power grid. While the spending is meant to counter the effects of climate change, the prospect of more transmission lines has resulted in the need to rely on rooftop solar panels and battery storage instead.
Ms. Poppe, who previously held positions at General Motors and two electricity suppliers, became the managing director of PG&E on January 1st as part of the overhaul following the company's bankruptcy. She said the company planned to make the announcement of underground power lines in a few months, but has now decided to do so due to growing public concerns about fire safety.
Mark Toney, executive director of the Utility Reform Network, which represents consumers before the California Public Utilities Commission and has often been an opponent of PG&E, said that reducing the risk of forest fires was a priority but that the utility had to come up with a plan that was huge Fund the project without overwhelming the fee payers. Based on underground power line proposals that PG&E previously submitted to state regulators, the project could cost about $ 4 million per mile, or a total of $ 40 billion, Toney said.
July 21, 2021 at 5:50 p.m. ET
“We would live in a world where only the rich could afford electricity,” he said. “PG&E needs a plan to reduce the greatest possible risk at the lowest possible cost to the fee payers.”
San Jose Mayor Sam Liccardo also questioned the possibility of funding such an ambitious venture without putting a burden on consumers. “If we assume that all PG&E installers win the lottery at the same time, we have the right of PG&E to do so,” said Mr. Liccardo, who tried unsuccessfully to turn the utility into a cooperative rather than a publicly traded one during PG&E's bankruptcy Convert company.
The Public Utilities Commission said it would consider PG & E's project when the utility officially submits it for review, a process that would include public hearings.
Ms. Poppe said the utility hoped to cut the cost per mile enough to put the total cost at $ 15 billion to $ 20 billion. “We cannot quantify risk reduction and safety,” she said. However, it did not go directly into the financing.
According to the Edison Electric Institute, an industrial trading group, about 18 percent of the country's power distribution lines are buried, including those for almost all new residential and commercial construction.
PG&E has been a focus of climate change impacts since a series of record breaking forest fires started burning in Northern California in 2017, several of which were caused by utility equipment.
The utility took several steps to prevent fires, including installing equipment to monitor weather conditions and remote shutdown of lines. It has sent teams to prune branches and clean up other vegetation that could come into contact with power lines, a concern that has grown along with widespread drought conditions in California.
However, the effectiveness of these efforts is increasingly being questioned, especially after the company reports that its equipment may have caused the Dixie fire. The forest fire season has months ahead of its peak.
State regulators and courts have fined the utility several billion dollars for failing to maintain its equipment and causing fires. The company, which filed for bankruptcy protection in 2019 after amassing $ 30 billion in forest fire liability, pleaded guilty to 84 deaths related to the Paradise Fire last year.
It was the second crime conviction for the utility company. In 2016, PG&E was found guilty of federal charges related to a gas pipeline explosion six years earlier in a suburb of San Francisco that killed eight people. This episode led the Public Utilities Commission to conclude that the company was more concerned with profit than safety.
In recent years, PG&E has also pissed off millions of customers by turning off their power to prevent their devices from igniting fires in bad weather. Some were even without electricity for a week.
Sheelagh McNeill contributed to the research.