[inferiorhuman]

I was in SF for the rolling blackouts in 2001 (and all around the bay area)

This is quite different, and the rolling blackouts were statewide.

Edit: The rolling blackouts were the result of letting Republicans draft hamfisted deregulation legislation. The resulting greed saw Texas energy companies fuck California about as hard as they could. What's happening now is also related to greed in that it's cheaper for PG&E to shut off power to prevent wildfires than it is for them to maintain their equipment. PG&E burned down huge swaths of California over the past couple years so they're being a bit more cautious now. The big difference is that while most inhabited parts of the state will want reliable power, the risk of fire is not equal. So where previously we all got fucked by PG&E's greed, now it's just those situated where PG&E runs high voltage transmission lines near combustible materials.

[Aloha]

Texas managed to deregulate power around the same time, and it's worked out pretty well, moving from Washington to Texas I saw a near 20% reduction in my energy rates.

The problem isn't deregulation alone, it's that generation was stripped from distribution, but retail sales wasn't decoupled from distribution.

[CalChris]

The ‘deregulation’ in California was designed to allow Enron to game the system. The blackouts were Enron gaming the system.

https://en.wikipedia.org/wiki/California_electricity_crisis

[Aloha]

Your assertion for designed isn't backed by your source, and had California fully deregulated the market, the swindle by Enron likely wouldn't have been possible, as public opinion would have goaded the legislature into action - but because the end consumer wasn't feeling any pain, no change was possible.

[CalChris]

Enron lobbied at both Federal and state levels for their version of partial deregulation which they could (and did) game. That's also covered in my cite.

[inferiorhuman]

Texas managed to deregulate power around the same time, and it's worked out pretty well, moving from Washington to Texas I saw a near 20% reduction in my energy rates.

According to Texas Coalition for Affordable Power (TCAP): "deregulation cost Texans about $22 billion from 2002 to 2012. And residents in the deregulated market pay prices that are considerably higher than those who live in parts of the state that are still regulated. For example, TCAP found that the average consumer living in one of the areas that opted out of deregulation, such as Austin and San Antonio, paid $288 less in 2012 than consumers in the deregulated areas."

[opportune]

We should just force them to maintain power when doing this even if it costs more than whatever fee they have to pay residents. I don’t even live over there but this is a huge inconvenience and I wouldn’t mind spreading out the extra costs for making sure it’s done safely to keep giving these people power.

The biggest bullshit is that now that PGE knows they’re too big to fail, they don’t even have to give a shit when they piss people off. If North Berkeley residents sued in a class action suit the state of California would probably just bail them out.

[lacker]

PG+E isn’t “too big to fail” at all, they just went bankrupt!

The real issue here is that PG+E is responsible for wildfires caused by power lines, and they don’t have many ways to deal with it. They aren’t allowed to raise rates to pay for more anti-fire measures. They can spend their fire prevention budget smarter, but at some point the gains there are maxed out. One of the few things they can do is to shut off power during times of high fire risk.

[inferiorhuman]

They aren’t allowed to raise rates to pay for more anti-fire measures.

They don't need to. They could cut back or eliminate their dividends, cut back executive compensation, stop buying back stock, etc., etc.

They cut back their line crews ages ago (plenty of cost savings there), and if San Bruno is any indication, PG&E hasn't bothered to keep records (additional cost savings) for quite a while.

[roenxi]

Well they could, but:

1) Those options, similar to spending the fire protection budget more smartly, also cap out at some point.

2) One of the reasons things like executive compensation get out of control is because they are a rounding error vs. the overall corporate spending. Cutting that back to the bone is not likely to be materially helpful.

3) "cut back or eliminate their dividends, ... stop buying back stock"

They may as well shut down the company (which is what they are doing on a temporary basis). There is no reason for them to be shouldering increased risk if the reward is reduced compensation. If that is the way the game gets played only idiots would be willing to own and manage a power company. It is more comforting to think that power companies are being managed by intelligent and rational people.

[inferiorhuman]

They may as well shut down the company

As I said PG&E makes a really great case for municipal power.

There is no reason for them to be shouldering increased risk if the reward is reduced compensation.

Fire prevention reduces risk. Conversely, this reduced risk scenario you're talking about has resulted in PG&E going bankrupt twice this century.

As for exec compensation and buybacks, PG&E spends a few hundred million dollars annually buying back stock. The fire prevention budget doesn't need to be infinite, but $200-300 million would go a long way. KTVU identified three SVPs who make around $500,000 annually. Yes, that's not a ton of money compared to PG&E's income, but a couple extra million could easily pay for brush/fuel removal.

https://ycharts.com/companies/PCG/stock_buyback

http://www.ktvu.com/news/despite-bankruptcy-pg-e-executive-g...

Edit: Per the KTVU article, that half a mill per SVP is the base salary, so bonuses and non-cash compensation aren't included.

[PeterStuer]

Actually having a vital utility in private hands is a guaranteed recipe for getting service that is optimize for making the most profit rather than providing the best value.

You might be lucky in the honeymoon period where the company is still getting entrenched, but once that is over and getting them out again is not that easy, you will gravitate to minimal service, especially in areas that require investment, and being bled dry and fleeced for wathever they can.

Large risks that would require preventive maintainable or modernization to mitigate will be ignored as the company knows they will be bailed out should it come to that.

And all this because of the neoliberale dogma that the private sector is somehow always 'better' than the public sector.

In reality large. organization of equal size have the same efficiency problems, regardless of them being public or private sector. And before you point to a leaner small private champion in a competitive field you should systemically add the cost of the dozens or even hundreds of competitors they are 'beating'.

The advantage you have when things are not in the hands of the private sector is that you can prioritise ongoing quality and value of service provisioning over maximisation of short term profit extraction.

[Google234]

Cut their income in half and get 1.5 million which is 0.008% of PG&E's income. Then those three SVPs will leave and you will need to hire three more which won't be cheap. How much do you think a SVP in a company making 18 billion a year should be paid? That sounds like a lot of responsibility to me and the people qualified for the job will expect to be compensated accordingly. Anyway, I doubt you would come out in the green at the end of this pointless exercise.

[bfung]

It’s also one of few levers to hold executives accountable for their decisions and actions. The other being jail time.

[roenxi]

> As I said PG&E makes a really great case for municipal power.

So if a power pole is owned by the government it suddenly becomes non-flammable? That isn't based on the laws of physics.

There is a strategy that makes countries fantastically wealthy: only do things that are profitable. Running the energy grid for no profits is not a path to broad-based success, it only results in taxpayers paying for things that have no marginal value. If it makes sense with electricity then there is no logical reason not to try the same strategy with gasoline, food and shelter. At some point the damage goes critical and Venezuela happens.

Also, buybacks aren't primarily a form of executive compensation; I'm no expert but they look like a work-around for double-tax issues in the American income tax law. A buyback is a method of transferring money -> stock holders and in this context is basically just a dividend.

I've no idea what is going on in California, obviously, but strategies like 'nationalise it!', 'stop the capitalists raising prices!' and 'Stop people profiting from their investments!' are just classic arguments that hurt everyone in the long term. Literally caused societies to collapse in extreme cases.

[inferiorhuman]

They can spend their fire prevention budget smarter, but at some point the gains there are maxed out.

For those following along at home, after blowing up a San Bruno neighborhood PG&E diverted $100 million of money earmarked for safety. Where'd that money go? Executive bonuses and dividends. They have plenty of money for improvements and there is zero need for rate increases.

https://www.sfgate.com/bayarea/article/PG-E-diverted-safety-...

[Animats]

PG+E isn’t “too big to fail” at all, they just went bankrupt!

Twice, since deregulation. Zero times, in the century before deregulation.

[inferiorhuman]

PG&E makes an excellent case for municipal power (sadly they fight every effort tooth and nail). Rather than forcing PG&E to do anything I'd settle for jail time for the management.

[nradov]

PG&E should be forced to do better safety maintenance. But it's too late to do anything else this week. They have to de-energize lines in high risk areas. We can't have a repeat of last year's fires.

[paulsutter]

Quite different because badly managed infrastructure vs badly managed infrastructure?

[inferiorhuman]

Yes, the situations are quite different because you're looking at environmental factors versus purely financial greed.

As fun as it seems to be for folks to shit all over San Francisco, neither the rolling blackouts of the early 2000s nor the preemptive blackouts this week have anything to do with city or county management.

[masonic]

  the result of letting Republicans draft hamfisted deregulation legislation

California's ludicrously gameable "deregulated" energy market of that time was set up by the leadership of the Democrat-controlled Assembly and the Democrat-controlled California Senate, then signed into law by Democrat Governor Gray Davis.

CA Republicans were powerless to "draft" anything.

[inferiorhuman]

California's ludicrously gameable "deregulated" energy market of that time was set up by the leadership of the Democrat-controlled Assembly and the Democrat-controlled California Senate, then signed into law by Democrat Governor Gray Davis.

You need to go back a bit further than that, back to Republican governor Pete Wilson and Republican author of the bill Jim Brulte. Wilson knowingly set up his successor (Gray Davis) to fail.

[masonic]

  Republican governor Pete Wilson and Republican author of the bill Jim Brulte.

'Democratic State Senator Steve Peace was the Chairman of the Senate Committee on Energy at the time and is often credited as "the father of deregulation".'[0]

Again, Democrats controlled both the Assembly and Senate throughout the process, and ever since. Bill contents are amended at will both in and out of committee, and "gut-and-amend" (removing a Bill's language wholesale and replacing it with that of a completely different bill to avoid rules about committee review) is so common, that term was coined for it.

[0] https://en.wikipedia.org/wiki/California_electricity_crisis#...

[inferiorhuman]

You conveniently missed the next two sentences:

The author of the bill was Senator Jim Brulte, a Republican from Rancho Cucamonga. Wilson admitted publicly that defects in the deregulation system would need fixing by "the next governor".

[masonic]

"The next governor" was a Democrat, and both houses of the Legislature were (and continue to be) Democrat-controlled from that election on, often with supermajorities.

As for the Brulte bill, not one Democrat voted against it in either house (77-0 in the Assembly, 39-0 in the Senate). It was shepherded through by Senator Peace and Assemblymember Martinez. Peace continued to claim parentage until after the resulting disaster.