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Comment by electic | Hacker News Reader

This isn't accurate. In the Bay Area some cities have decided to run their own public utilities instead of relying on PG&E.

For example, Santa Clara runs their own public utility[2]. The average resident pays about 10.4 cents per KWh. That's about 30 percent less than rates PG&E charges.

Also, their energy is greener and their infrastructure is better maintained.

The problem with for profit utilities is that they are incentivized to keep things as lean as possible. They neglect maintenance of their infrastructure and use that money for bonuses and dividends. You can see that played out here [1].

[1] https://www.sfgate.com/bayarea/article/PG-E-diverted-safety-...

[2] http://www.siliconvalleypower.com/

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Arguably this is Santa Clara skimming from the system. Carve out a high density environment and let them pay just for themselves and you’re definitely going to come out ahead of trying to electrify rural California.

> The problem with for profit utilities is that they are incentivized to keep things as lean as possible. They neglect maintenance of their infrastructure and use that money for bonuses and dividends.

They aren't incentivised to be excessively lean. The incentive structure for someone who has spent a fortune on expensive capital investment is to maintain it.

There is no point incentive to build a vast system of poles and wires then letting it degrade over time.

Anyway, it won't be capitalist incentives at work; it will be something in the details of the regulations. In Australia, due to poor market regulations, we have the opposite problem where our utilities spend far too much on grid maintenance.

There is no point incentive to build a vast system of poles and wires then letting it degrade over time.

Sure there is: short-term profit.

That isn't an incentive, that is just greed. And not actual "make the most money" greed, but stupid greed where that is the choice that they would make if they don't think at all and nobody points out the obvious to them.

Making a long-term investment to squeeze it for unsustainable short term profits is genuinely stupid. There is no incentive to do that. They would make more money milking the grid for long-term profits.

Making a long-term investment to squeeze it for unsustainable short term profits is genuinely stupid.

If you've got a better name for it I'm all ears. But PG&E has been neglecting their infrastructure at least since the early 90s when their lackadaisical approach to clearing brush led to the Sierra Fire in '94.

Keep in mind that PG&E's record keeping was so lax that they blew up a neighborhood in San Bruno after increasing the pressure on a gas pipeline without knowing if the line could support such pressure. Apparently PG&E also got sued a couple years ago by shareholders alleging gross mismanagement and demanding safety reforms. I'd say there's plenty of stupid and greed at PG&E to go around.

> If you've got a better name for it I'm all ears.

'Incompetence' would be the normal choice. And standard run-of-the mill incompetence has nothing to do with profit motives or incentives.

You can get incompetence with any governance structure; it isn't related to profit motives. If they are being sued by their own shareholders that is quite solid evidence that it isn't capitalist incentives that are the problem.

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