I'm not from the USA, is my understanding of this correct?
The power utility is liable for fires caused if a branch blows into its power lines during high winds. So the power utility has chosen to turn off the power in high winds?
There's a missing piece where the utility has been pretty negligent about doing things to prevent fires and that at least some previous fires started by the utility could have been prevented.
Correct. If a fire is started and the ignition of that fire is shown to be linked to a utility's assets (power lines, gas line etc.) then all the damage caused by the fire could become a lawsuit liability for the fire.
That is a cynical conclusion, but the incentives are aligned for that it to be logical. The article framed the motive as to try "avoiding disaster". It seems like the most rational decision for PG&E to take considering the circumstances.
The intended consequence would have been for the company to cut vegetation around its lines so this can't happen, but apparently turning off power is more profitable.
they only have nearly twenty thousand miles of high tension power lines to look out after, how hard can that be /s?
then throw in a hundred thousand miles of everything else.
problems look simple until scale is understood. the real truth here is PG&E is effectively a state run corporation, they are so heavily regulated and managed by the state that the only "corporate" part of them is the investors who buy into these state regulated utilities in hopes of safe returns.
so in effect, the real guilty party here is the state government but the illusion must be kept in place that they are instead the fixers.
The real guilty party here is the state government for privatising a natural monopoly/utility and therefore having introduced a profit motive.
If PG&E is effectively a state run corporation (which is correct - providing essential utilities will ultimately fall upon the state as a provider of last resort), then it's most efficient to remove the private elements of it.
No, it's for not regulating them more strictly. But as monopolies, the California Public Utilities Commission does regulate them somewhat heavily compared the average business.
> If PG&E is effectively a state run corporation
There's a long enough track record of mismanagement in government that 1/3 of people ~anywhere in the US would say government management is a problem, then point to FEMA and the DMV. There's also the issue that the government's not liable for mistakes, so you have no recourse for run-of-the-mill accidents.
I disagree - regulation is another inefficiency.
Why would you privatise and then spend money on regulating, when you could spend that directly on providing the service?
I feel like this might, in part, also be caused by the hate for taxes in the US. The goal seems to be lowering taxes as much as possible until only the bare minimum is left. Proactively maintaining public land is not something people deem important (until it's too late) so that's an easy thing to skip. 'Adopt a highway' is a perfect example of something that, in my opinion, should be taken care of through taxes, but is now the responsibility of good Samaritans.
Now this is what it looks like from far away in Europe and I might be completely wrong.
Taxes is a red herring. Most of this area is forest—“maintaining it” doesn’t involve clearing trees. The only reason to do that would be for the safety of the power lines. And depending where you are in Europe, the money for stuff like that comes from the same place as in California. A government regulatory agency (in California, the CPUC) decides what prices the utility can charge based on what it perceives as being “prudent investments” by the utility plus a small profit. The money comes not from taxes, but from rate payers.
The reason this kind of maintenance failure happens in the US is because our public regulators are more short sighted than your public regulators. They are political appointees that keep rates too low to keep voters happy. The US has some of the lowest electric rates in the world: https://www.ovoenergy.com/guides/energy-guides/average-elect.... (California’s are high for the US, but still very low compared to Europe.)
You're just talking about the areas near power lines now though. Those fires wouldn't be as big of an issue if the rest of the area was properly maintained, not allowing the fire to spread. That part has nothing to do with the power companies.
So yes, not having the fires start is on the power companies, however making sure it can't spread isn't. Which is why I wrote 'in part'.
I see. The Americans aren’t averse to paying taxes for controlled burns. It’s a political issue in California for environmental reasons, not financial reasons.
This is misleading due to how states structure their tax code. California has a high top marginal rate, but its progressive taxation system leads to many of the middle class and under paying lower taxes than in other states. I live in Iowa, for example, and the top marginal tax rate is 8.9% for all income earned over $72k. The top marginal rate in California is 13.3%, but only applies to income over $1MM. A couple making $80k in California will pay about $2k (effective 2.52%) in income taxes, while the same couple in Iowa will pay $3,976 (effective 4.97%). You can't just compare tax rates by comparing the top marginal rate. You've got to look at how they actually impact people.
As if that's not complicated enough, throw in the 10% CA sales tax versus 7% in Iowa. And property tax. Prop 13, Prop 8(?), et. al., can make a considerable difference, as I understand it. Props or not, the total is likely to be higher just because housing is much more expensive in CA. 20% of 200,000 is a lot less than 10% of 1MM.
But in the end, as a WA resident who has given serious consideration to moving to CA and has done this math a few different ways, my gut has a hard time believing Iowa's overall tax burden is comparable to California's. Regardless, maybe it's true or maybe it's not, but is an extra $10,000 in taxes what's really keeping you from picking up and moving? I posit that for most on HN, no, it's a lot of other factors like housing and traffic.
But to the topic at hand, others have pointed out that PG&E is financed by rate payers, not taxes. And CA has some pretty high electric rates. So why are the forests catching on fire?
Not generally but they are a low property tax state for those "grandfathered" by Prop 8. Which is another can of worms and not particularly relevant here.
I don’t necessarily disagree with some of your points.
But Adopt a Highway (adoptahighway.net) is a marketing and advertising program. Which apparently works as many, like you, probably think they’re doing this out of the goodness of their hearts.
I know, that's why most of the pieces of highway still look like shit, because these companies don't actually take the time to maintain what they adopted. Which is exactly why I think it shouldn't exist and taxes should be used to keep roads clean.
It's one company that does the work under contract as I understand it. The individual companies are just paying to get their name on a sign. (Which is probably how it would be done even if the state were paying for it all on their own.) If they aren't doing the job well, sounds like the state should renegotiate their highway cleaning contract.
No one (or extremely few) wants a world where no trees could ever fall on a power line.
If a car crashes into a power pole and sparks an inevitable fire, is the driver liable? If the normal operation of a mower triggers an inevitable fire, is the operator liable?
But a lot of people want a world where reasonable measures are taken to reduce the risk. Like managing trees for a dozen meters around a power line. It's not rocket science.
Typically it's a hundred yards on either side of a high voltage line. And with the liabilities P&G is facing, I'd clear cut a hundred yards on either side of medium voltage lines too.
That's a 1km^2 of cleared forrest for every 10 km of line. California has (tens of?) thousands of km of lines.
Why is that bad? Alternative is burning trees adding to pollution or people living in dark. You could offset the green coverage elsewhere in the state or country.
No the alternative is extremely reliable electricity that runs year round, and an occasional forest fire.
Which of course the fires are going to burn no matter what PG&E does. “But for an electrical spark” is a great way to lay the blame but ignores the hundreds (thousands?) of forest fires each year that start from non-electric sources.
In the scale of the maintenance required to have zero risk of fire — hundreds of billions of dollars — the $4 billion in dividends is a rounding error.
CA is going to have to do the math and decide it’s not worth $100 billion in guaranteed economic depression due to cutting power to try to save a 5% chance of a $100 billion fire.
CA is also going to have to do the math that no one is going to pay to maintain a grid that’s fire proof but charges $3/kWh for power.
At some point, we have to accept that wildfires are natural and that if we’re going to hold people accountable for the total outcome of their (fairly random) part in the ignition event, we’re going to find people and companies naturally taking a risk-mitigation stance, including stopping maintaining firebreaks and proactively turning off power to large parts of the grid in high-risk areas until some other unlucky sod triggers the fire instead.
It's also possible that is not feasible to do all that maintenance work and still keep the rates at what they are now. Until now, PG&E made believe like they were maintaining and state officials made believe that Californians were paying a market rate for power. Apparently they have to maintain an area roughly twice the size of Portugal https://www.pge.com/en_US/about-pge/company-information/prof... in all kinds of terrain.
So now CA state will probably take over and do something with liabilities.
It's a similar issue with DB Netz rails and tracks in Germany — the amount of maintenance is too much, and too expensive, so they stopped cutting the vegetation about 20 years ago. And now, with every little storm, trees end up on the rails.
The CPUC sets PG&E's profit margins so if they company can't persuade them to let them increase their profit margin then spending more on maintenance would be a good way to make more money. But of course, that would require them persuading the CPUC to let them raise rates to pay for cutting the vegetation.
When you said make money, do you mean generate revenue? Because turning off the power does not generate revenue (but of course, i understand what you are trying to say). I don't know what PG&E does or their relationship with the CPUC, but typically the best way to get that rate increase is to do actual grid improvements. I would presume that would be getting out in front of their current situation.
From what I understand this situation might be a complex mix of mismanagement at every level, state to utility.
The power utility is liable for fires caused if a branch blows into its power lines during high winds. So the power utility has chosen to turn off the power in high winds?