California regulators announce probe into PG&E corporate structure
The Chairman of the California Public Utilities Commission on Thursday announced a broad investigation into the "corporate governance, structure, and operation" of Pacific Gas and Electric amid a safety audit of its equipment, which has been linked to multiple deadly wildfires.
The statement from CPUC Chairman Michael Picker came as his agency ordered PG&E to implement more than 80 safety recommendations from an independent consultant related to a 2010 natural gas pipeline explosion. Picker said the incidents reveal that PG&E "appears not to have a clear vision for safety programs."
The move comes as California fire officials investigate the cause of the Camp Fire, which killed 88 people and burned more than 150,000 acres. PG&E has said one of its transmission lines malfunctioned in the area where the fire ignited.
The CPUC's actions Thursday are another indication that major structural changes could be coming for PG&E, California's largest utility.
Earlier this month, Picker said the CPUC investigation could lead to a restructuring of the company, but that California regulators would not let it go bankrupt.
Picker reiterated that sentiment in a statement issued after the agency's monthly meeting, saying that his review of safety reports connected to the 2010 San Bruno gas pipeline explosion also led him to ask "whether there is a different model to ensure safe and reliable electric and natural gas service."
PG&E said in a statement that it had already implemented most of the 80 recommendations connected to the San Bruno pipeline explosion. The utility has said it is cooperating with investigations into its power lines, which were blamed for starting 16 fires last year alone.
PG&E's costs for the fires are likely to exceed its insurance coverage, the utility warned this month, sparking concerns of a potential bankruptcy filing. Picker, however, said again on Thursday that regulators would ensure PG&E’s financial health through the transition.
"To operate the grid in a safe manner, PG&E must be able to sign contracts and raise capital," he said. "This is a bit like remodeling an airplane in mid-flight. We don't want to crash the plane while we are trying to make it safer; that's bad for the passengers."
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