Fog and smoke

9 September 2019 By Robert Cyran Follow @rob_cyran

The city is offering $2.5 bln for one of the bankrupt utility’s best assets. It might benefit Bay Area residents who effectively subsidize citizens in more fire-prone locales. But it would leave PG&E far less able to cope with future financial, political and environmental crises.

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San Francisco has offered to buy power lines and other assets serving the city from bankrupt PG&E for $2.5 billion in a letter dated Sept. 6, according to PG&E. The utility said in response, “PG&E has been a part of San Francisco since the company’s founding more than a century ago, and while we don’t believe municipalization is in the best interests of our customers and stakeholders, we are committed to working with the city and will remain open to communication on this issue.”

San Francisco Public Utilities Commission already produces hydroelectric power, which it transmits to the city and distributes to a limited number of customers.

PG&E declared bankruptcy in January after a series of wildfires in 2017 and 2018 left it with $30 billion or more of liabilities, by its own estimate. The utility has until Sept. 29 to propose its own plan for exiting bankruptcy, at which point it may win an extension from the court provided it makes sufficient progress.

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