Governor Newsom considers a state takeover if PG&E is unable to manage its utility operations. Severin Borenstein says on KPCC that this is an area that should certainly be explored, as the state steps in when it comes to other natural disasters – but when it comes to electricity, this has not been the case thus far.
Gov. Newsom Floated The Idea Of A State Takeover Of PG&E. How Would That Look And How Would It Impact Customers? – November 2019
“I think that it’s important to know that when we get to these situations, where the utility is making the call on a power shut off, they have pretty tilted incentives. The way the law works in California, a privately owned utility is bearing all the liability if their equipment does start a fire, even if they’re not negligent. Whereas, they don’t bare any of the costs if they have a power shutoff; those costs are born by the customers. From a utilities point of view, even if they are well meaning, they are going to be pushed pretty strongly towards calling a lot of power shut offs, which has led to a lot of controversy when we’ve had them recently. But on the other hand, we have a real problem right now: we do need to consider the longer issue for what we should do with PG&E, but we also have to get through the next two or three months of significant fire risk. That is almost certainly going to require these very difficult trade-offs.”