They also had massive negative cashflow going back over a decade and paid for those dividends with lender’s money. The entire thing wasn’t sustainable.
It isn’t necessarily fair to single out California because many other public utilities are in a similar situation, California just has added significant natural disaster risks. Regulated utilities have been considered a safe investment for so long that many shareholders and probably management have been asleep at the wheel for years. The regulatory aspect means there isn’t much those parties can do without state/voter approval.
I’m hardly an expert in capital markets, so I’m not going to claim if PG&E did or didn’t pay dividends X would happen. I don’t know. What I do know is PG&E probably needed 3-4x the revenue they had, either by increased rates or borrowing which would lead to even greater rate increases eventually.
I would say in general this is a good thing. California’s residents are now extremely incentivized to move to home solar + battery storage. California may even hit their renewable energy goals ahead of schedule.
It isn’t necessarily fair to single out California because many other public utilities are in a similar situation, California just has added significant natural disaster risks. Regulated utilities have been considered a safe investment for so long that many shareholders and probably management have been asleep at the wheel for years. The regulatory aspect means there isn’t much those parties can do without state/voter approval.
I’m hardly an expert in capital markets, so I’m not going to claim if PG&E did or didn’t pay dividends X would happen. I don’t know. What I do know is PG&E probably needed 3-4x the revenue they had, either by increased rates or borrowing which would lead to even greater rate increases eventually.
I would say in general this is a good thing. California’s residents are now extremely incentivized to move to home solar + battery storage. California may even hit their renewable energy goals ahead of schedule.