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Comment by Tyrek | Hacker News Reader

I don't necessarily agree with your 'simple logic' - there's plenty of stuff that can be done (but not perhaps outright regulated) that can reduce the incidence of fires around electrical equipment. (i.e. maintaining clearances around transmission stations, etc.) That involves probably more cost that the /free market/ would enjoy bearing. This measure can be framed as an attempt to force the externality (i.e. the damages caused by fires) onto the cause - Why shouldn't individual power consumers of California bear additional cost to prevent/reduce the incidence of fires? Your position is one of deliberate helplessness, and entirely assumes that companies should only toe the regulatory line and go no further.

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It's a regulated utility so the free market doesn't really come into it, fundamentally regulated rates are set by CPUC.

These rates need to go up to allow more a more aggressive vegetation control schedule. Sure, I agree with that, and I agree that individual power consumers should pay for that. However the way I think they should pay is precisely through that rate mechanism.

What I do not think is efficient is putting the entire consequential damages of a fire caused by an electrical fault on the utility. That is only an effective mechanism to the extent that the fire damage is preventable by them. While they can reduce the chance of this happening through stepping up vegetation clearance and they probably should, it is not possible to reduce it to zero and given the size of the network there may well be fires every year even in the best possible case.

To say in the context of climate change, forestry policy, the location of houses in areas that face these fire risks, and the construction of those houses of flammable materials that PG&E "caused" this fire and the previous ones and should therefore bear the damages seems strange to me.

Aren't PGE rates already some of the highest in the Country?

They can go higher...and they will. The state can always issue bonds, so creditors always get paid. CA isn't about to default for a few tens of billions.

The biggest problem is zoning. OK, PGE might caused this, but odds are that within a decade it would have burned anyway. A camp fire, a faulty car exhaust on late August, fire works and so on. ZONING is the real issue now. You know that the area is prone to fires and people build houses in the mountains, surrounded by 100 feet trees?

The size of the network also increases the number of their paying consumers, so I don't think that's a good excuse for them. Two Californias side by side would have half the mean time between fires, but also twice the budget to prevent them better.

It’s not just about brush clearance, some of their equipment was found faulty and unmaintained, further implicating them.

> I don't necessarily agree with your 'simple logic' - there's plenty of stuff that can be done (but not perhaps outright regulated) that can reduce the incidence of fires around electrical equipment.

Your objection to the grandparent's "simple logic" seems right to me.

Inverse condemnation could motivate utilities to seek solutions that have longer-term profitability but require higher capital investment, something that would be difficult to legislate.

For example, PG&E could choose to deliver electricity through underground equipment which would cost more than pole-and-wire networks but might reduce forest fire risk. Legislating such a requirement even for strictly regulated utilities might be more complicated than inverse condemnation.

On its face, inverse condemnation does seem to punish utilities even if they are technically in compliance. Perhaps inverse condemnation could exert market influence in ways that are subtler and less technologically constraining than explicit regulation.

Yes, but it's quite probable that (as Mvandenbergh claims) there is no way to make the equipment 100% safe. It occasionally fails. Humans have a response time. People make mistakes. Homeowners shriek if you cut their electricity off preventively.

PG&E has 81k miles of overhead power lines and 26k miles of underground distribution lines.

How can you operate a system where one screwup -- one decaying tree too close to a line, or one underground construction mistake -- anywhere in 100k miles of power lines can create a $15B bill?

[1] http://www.pgecurrents.com/2017/10/31/facts-about-undergroun...

PG&E is a joke.They have done next to nothing to mitigate risks in extremely high risk areas for decades. Of course you can't get to zero risk, but it is right to push heavy responsibility on them until they up there game to remotely modern standards. If their corporate culture can't handle it, then they should be absorbed into one that can.

Insurance (expensive and a pain as they'll be checking on you but...)

Honestly, if you cause economic harm, the minimum is that you should pay for it. People lost everything in these fires and insurance companies will pay but then sue the other person /entity responsible.

Is the consumer responsible in this world of always finding someone to foot a bill for a disaster?

With new technology? I see no inherent reason that a downed power line needs to cause several giant arcs. I don’t know exactly how big an arc is needed to start a fire, but ISTM it should be possible to make line-to-ground faults only arc a tiny bit and line-to-line faults make much smaller arcs.

CA has a big head start here over the rest of the country: in CA, utilities cannot have current-carrying wires that are grounded at multiple points. That practice is widespread elsewhere and is rather dangerous for several reasons. And I think it would interfere with several potential technologies to reduce arcs.

(I don’t really know, but I assume CA’s rule is related to the dairy industry. Utility-induced ground current turns out to be hazardous to cows being milked with metallic equipment.)

I don’t know exactly how big an arc is needed to start a fire

Not very big, sparks coming off a tow chain dragging behind a vehicle can start a fire.

http://www.fox13news.com/news/local-news/officer-shows-how-s...

PG&E is now cutting off power preventively and homeowners should complain about it. Making everyone buy a generator for their house is not very cost effective and symptom of system collapse, but if they are going to get a $15B bill because of poor forest/land management by other entities, that's what they will need to do.

Maybe this situation will progress like the toxic waste disposal business. Break down PG&E into small utility companies so that when the $15B bill comes due the $100 million company just disappears and someone else picks up the tab.

You make good points, but if I read that correctly California also limits how much they are allowed to charge customers. I'm all for them bearing the risks and letting the free market pass that cost on to customers, but that's not the system that's in play.

Also from the article: PG&E will likely use a bankruptcy threat again as a way to get legislative aid, Gimme Credit’s Levenson said.

Please don't let them do that. Have them actually go bankrupt and deal with the fallout from that.

> You make good points, but if I read that correctly California also limits how much they are allowed to charge customers

All (most?) states do this, it's the entire role of the public utilities commission to review tariffs proposals by utility companies to ensure they aren't price gouging. This is the tradeoff for having a state-granted monopoly over a region.

CPUC isn't there just to prevent price gouging. They've already decided a guaranteed return on equity / return on rate base. If the legislators decided tomorrow the lines must be buried, and the CPUC allowed the rate hike necessary to do so, PG&E would happily comply.

> The PG&E and other investor owned utilities that are essentially granted monopoly status in California are guaranteed a negotiated fair rate of return on equity (ROE). PG&E's ROE rate was set at 10.4% and a return on rate base (ROR) was set at 8.06% by the CPUC in December 2012. https://en.wikipedia.org/wiki/Pacific_Gas_and_Electric_Compa...

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