Utilities such as gas and electricity are necessities, but more than 20 million Americans struggle to pay those bills.
The companies that generate and distribute that energy, on the other hand, have unique challenges that they must face. It’s decades-old infrastructure, pressure to “green” systems, and investor returns.
In her new book, California Burning: The Collapse of Pacific Gas and Electricity—and What It Means for America’s Power Grid, Catherine Blunt explains how budget cuts and past failures to maintain the system have collapsed. We are talking about what has resulted in a falling infrastructure, leading to costly and deadly accidents.
Blunt joined Kai Ryssdal on Marketplace to talk about the role of utilities, not just as profit-generating companies, but as public goods, and why electricity grids are mismanaged across the country.
Below is an edited transcript of their conversation.
Kai Risdal: Can you jump to the subtitle of this book? It’s called “The Pacific Gas and Electric Collapse—And What It Means for America’s Power Grid.” Can you talk a little bit about the rise of Pacific Gas and Electric, the infrastructure that has been handed down over the past century? This is because
Catherine Blunt: absolutely. So PG&E he merged with another company in 1930. The company had built much of the transmission infrastructure throughout the foothills of Northern California’s Sierra Nevada mountains. And in November 2018, one of the 100-year-old towers malfunctioned, eventually dropping live wires and sparking the deadliest and most devastating wildfires in California’s history. And if you think about the entire American power grid, there are a lot of things that are pretty old, decades old, if not 100 year old components. As a result, parts of the grid are becoming more prone to failure, especially as climate change creates new stresses on the grid.
Risdal: Well, let me jump to the question I thought was going to be the last question. And then we continue with the subtitle theme. What does that mean for America’s grid? Because we need power all the time. But you should also avoid investing in expensive fossil fuels such as coal-fired or natural gas-fired. We must care for the environment. You have to change your infrastructure. But we are dealing with things that are decades and hundreds of years old.
Blunt: That is correct. Utilities across the country now face significant challenges in greening systems, transitioning to cleaner forms of energy, and upgrading grids to replace some of this decades-old infrastructure. And electricity is what we always need. And we will need more of it in the future.
Risdal: Now let’s get to PG&E specifically. And some incidents introduced in this book. There have been several deadly wildfires caused by PG&E equipment failures, and a natural gas explosion from a faulty pipeline in San Bruno, California, in the San Francisco Bay Area. And you describe the scene in the aftermath of that explosion with his PG&E executives reviewing his PowerPoint. And they’re talking about “debatable”. Literally, it’s the phrase “this is debatable.” And these things are indisputable. Set the scene for us and let us know what was and isn’t the subject of discussion for Pacific Gas & Electric.
Blunt: of course. This powerpoint was made just before the natural gas pipeline exploded, but he had one powerpoint slide about what management had turned in a powerpoint at an offsite meeting and was out of discussion. . The subject of discussion was safety and reliability.
Risdal: Excuse me, please say that again. Because it sounded like you said it.
Blunt: That’s what is implied in this slide. And this PowerPoint slide came to light as court evidence that finally proved PG&E’s criminal liability in the blast. And plenty of other evidence moving forward has done a lot to show that PG&E has prioritized profit over safety for years.
Risdal: Why is it so hard for us to draw lines and clarify boundaries between utilities and businesses where everyone needs power? If the question makes sense. you know what i mean?
Blunt: I see, i see. No, most of our power is provided by what we call investor-owned utilities. And a strange hybrid business, so to speak. They are publicly traded companies and benefit from their shareholders, but they are also regulated organizations that provide critical services. And it’s hard. So, the nature of business has historically created a tension between these private interests (shareholders) and the public interest.
Risdal: So let me tell you, this is a good, fast and engrossing read, and I don’t want to get too deep into the weeds of PG&E’s legal trials and tribulations. what we have. That’s why I said so because I want to encourage people to read books.
Blunt: Yes, so there’s no question that the new leadership team understands system-wide risk like never before, and the consequences of mismanaging that risk. For example, a new CEO came in and introduced a new strategy to bury 10,000 miles of power lines to keep them from burning. And in theory it’s a great idea. But it comes with many challenges. There are financial challenges, labor challenges, and engineering challenges. I’m sure there is a desire for that. There are also practical realities to deal with.
Risdal: And I have to say it’s not just California, right?
Blunt: That is correct. No, it’s not. The topic of how to transform a particular utility system to address new risks is becoming a topic of great importance across the country.
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