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interviews

What State Takeover Looks Like

by Senator Scott Wiener
September 2, 2021

This interview with Scott Wiener, a Democratic state senator representing San Francisco and author of SB 917 which would turn PG&E into a state-run electricity and gas provider, was conducted and condensed by franknews.

I have lived in San Francisco since 1997. I have a lot of experience as a resident and as an elected official with PG&E. I have seen the good, the bad, and the ugly over time. And it got to a point where I really questioned whether we were being well served by a utility that was very focused on shareholder returns. PG&E covers a massive geography — much larger than any other utility. A lot of that area is very rural, very spread out, and PG&E has just not invested appropriately in maintaining that infrastructure. And we were seeing the fallout of that. I think we have a lot of good models for publicly owned utilities that work well. My view is that we should move in that direction.

What are some models that you look to? 

All over California, we have various municipal utilities and publicly owned utilities in Sacramento and Los Angeles, as well as smaller ones in Healdsburg or Palo Alto. They're not all perfect by any stretch, nothing is, but you can get much more focused on the needs of the ratepayers and the community, and not so focused on Wall Street.

What does it mean to become a public utility and what is the legal framework for that transition? 

Yeah, it can be done in different ways. We are a couple of years out now, but the way that we structured it in the bill was that a public benefit corporation that we set up, would then acquire the shares. So basically the utility would be owned by this public benefit corporation.

So what changes? 

In the short run it would be a transition, so it's hard to say. Over time, the main thing is that the utility would not have to be so focused on shareholder returns and could really focus on investing in the system and the infrastructure to make it safe and reliable. PG&E is very expensive, anyone who is a paying customer knows that. We want their rates over time to stabilize and go down instead of this continual increase that we're seeing.

What do you think investing in infrastructure for PG&E looks like? Is it maintenance? Is it undergrounding? Is it renewables? 

All of the above. I mean, job one is to take care of the infrastructure that exists and not just as a matter of triage, but as a matter of getting ahead of the curve and maintaining it before it deteriorates and causes problems.

Undergrounding can be a very powerful tool, but it's also extremely expensive, especially in the areas that it would be most worthwhile from a safety perspective to underground. The undergrounding conversation to me is, uh, it's a separate conversation, an important one, but job one is just making sure that we're actually maintaining the existing infrastructure, so that it does not deteriorate to the point where it's causing fires.

And what do you feel like the public will do around this kind of transition? 

We took a ride on public ownership and did not get very far at all. So clearly the politics were not there in the legislature. I do think you're right, that we go through moments of time where there's public interest in a particular change, but that can dissipate very quickly. I think the public ownership debate needs to continue.

What were the main critiques that you heard?

I mean, it came from everyone. The utilities hated it, labor hated it.

Was labor’s concern basically that they just didn't think their pensions and jobs were secure?

They were not convinced that they would be made whole. We had provisions in the law to make them whole, but they were not convinced.

And what was the public perception like? Did you do any polling around that?

We didn't do any polling. I think there's a fair amount of support, public ownership, but I think the public has split from what I can tell.

It feels opposed to the American view of the business to start talking about this sort of thing on a large scale.

Right, even though the U.S. has a long tradition of public ownership of utilities, including in red states.

Where do you go from here? Are you interested in trying to push through similar legislation?

We don't have any current plans to reintroduce that unless something shifts politically. It's probably not the time, but we're keeping an eye on it. 

I am curious as to why the California Public Utility Commission (CPUC) doesn’t seem to act as strongly as a regulatory body as they could. Why is that the case? 

I think there are a lot of good people at the CPUC. But it is an agency that I believe is very tied to the status quo structure, and I think it struggles to move beyond that.

Right. People get comfortable. Which seems to be our problem at a large scale. Thank you for your time.