This was the scene in San Bruno California on the afternoon of Sept. 9, 2010 when a
PG&E gas line exploded causing the deaths of 8 people and extensive property damage. PG&E as a corporation has been criminally charged and the case is still in the court process. Recently a major political scandal has erupted over their behind the scenes efforts to manipulate and influence the outcome of the related cases. Along the way more evidence of corruption between PG&E and the chairman of the state Public Utilities Commission has emerged. The federal government has opened an investigation into the matter.
Pacific Gas and Electric Co. is the major public utility for Northern California. I has a very long history of wheeling and dealing with the officials who are supposed to regulate its activities. The situation in California is not all that different from many other states where the regulation of public utilities is often characterized by crony regulatory capture.
California was ground zero in the Enron schemes to create a phony energy crisis and game the recently deregulated rate structure. PG&E has always managed to see to it that regardless of whatever messes they got themselves into, the customers and not the shareholders footed the bill.
The scandal has fallen squarely in the lap of Michael Peevey , chair of the CPUC.
California power regulator to exit amid criticism
Peevey was under fire in connection with a series of emails describing alleged backroom dealings between him and others at the commission and California's biggest utility, Pacific Gas & Electric Co.
In emails released by PG&E on Monday, a utility official described Peevey pressing the utility for more than $1 million in campaign donations and other gifts during a dinner in which the two also discussed at least five PG&E regulatory matters before the commission.
The emails were the latest released by the utility and others that show PG&E executives privately hashing out utility-rate cases, financial penalties and other regulation with California Public Utilities Commission officials.
The company has said prosecutors have informed the utility that federal authorities are investigating the legality of five years of back-channel communications between it and the utility commission. The U.S. attorney's office said it would have no comment.
As recently as August , California Gov. Jerry Brown publicly defended the regulator as a man who "gets things done," especially on Brown's priority of promoting renewable energy. Brown has been silent as three separate releases of emails showed Peevey privately negotiating utility fines with PG&E and pressing PG&E executives for donations
.
This latest revelation comes on top of an earlier fiasco that resulted in the firing of three PG&E executives and the removal of Carol Brown who was Peevey's chief of staff. There is presently a rate case pending before the commission to determine how the cost associated with the San Bruno blast will be apportioned between rate payers and shareholders. Brown had agreed to remove an administrative law judge from the case because of objections expressed by PG&E.
Government really doesn't get a lot sleazier than this. There is a strong body of evidence that the explosion resulted because of gross negligence on the part of PG&E. Here we have the same officials who are supposed to be in control of their activities hitting the company up for political donations. The political pundits are saying that Jerry Brown will be relieved to have Peevey out of the way before the election.
This is a situation that calls out for criminal action. I would seriously advise people not to hold their breath waiting for it to happen.