PG&E Faces Strict Probation Judge After Massive Kincade Fire

(Bloomberg) -- For the first time since a fire last month scorched 77,758 acres of northern California, PG&E Corp. returns to the courtroom of the judge whose personal crusade is to “reduce to zero” the number of wildfires caused by the utility’s equipment.

So far, PG&E hasn’t been found responsible for the Kincade fire, though it has suggested it might be. And the official item on the agenda when the company appears Tuesday before U.S. District Judge William Alsup in San Francisco is far less controversial than the wildfires that have so vexed him.

But Alsup has previously started PG&E hearings by asking those in his courtroom to reflect on the fact that a number of wildfires caused by the utility in the last few years have burned 3% of California. As the overseer of the company’s criminal probation following its 2016 conviction for gas pipeline safety violations, Alsup has taken on the role of strictly supervising PG&E’s fire prevention efforts.

PG&E Faces Strict Probation Judge After Massive Kincade Fire

Alsup is “a clear voice that says the only goal is no fires, and I don’t think PG&E has gotten that message so clearly from any official or other arbiter of its fate,” said Michael Wara, a climate and energy policy professor at Stanford University.

“He’s a voice representing many people in northern California,” expressing a collective concern that “this company is not changing enough to reflect the severity of the harm that it has caused,” Wara said.

PG&E’s equipment was tied to wildfires in 2017 and 2018, saddling the company with an estimated $30 billion in liabilities and forcing it into bankruptcy. Last year, a loose PG&E jumper wire was found to have contributed to the deadliest and most destructive fire in California history, which killed 86 people and razed the California town of Paradise. The Kincade fire, centered in wine country an hour north of San Francisco, took firefighters two weeks to bring under control after it started Oct. 23 and destroyed 374 structures.

The company preemptively cut power to millions of California residents to prevent blazes during a windstorm -- a move that Alsup has supported as a fire-prevention effort but has led to intense criticism of the utility.

PG&E Chief Executive Officer Bill Johnson has been a faithful attendee at Alsup’s hearings. Seeing him and the utility’s lawyers in court face to face, it’d be hardly out of character for the judge to vent fresh apprehensions.

Alsup already has given PG&E a Nov. 29 deadline to turn over details about whether a jumper cable might be responsible for the Kincade fire. Even if the company is spared Tuesday from another interrogation about possible equipment failures, PG&E will certainly be asked to explain details about what Alsup previously described as a “half-baked” fire mitigation plan for the city of San Bruno, just 12 miles south of San Francisco.

PG&E is on probation for felony convictions stemming from the 2010 explosion of one of its gas pipelines in San Bruno, which killed eight people. In lieu of the remaining community service hours PG&E officials were ordered to perform as part of the probation, San Bruno has asked Alsup if the company can instead pay $3 million to help fund a project to clear vegetation that poses a fire risk.

Concerned the money will be frittered away on consultants and lawyers, Alsup asked San Bruno and PG&E officials to return Tuesday with a concrete plan.

The company doesn’t have a position on San Bruno’s proposal, spokesman James Noonan said. PG&E is ahead of schedule toward completing its 10,000 hours of community service and officers and directors have already finished the 2,000 hours allotted to high-level personnel, Noonan said.

“PG&E employees from all levels of the company have been engaged in significant service projects over the last four years,” he said in an email.

Alsup routinely starts PG&E’s probation hearings explaining to those in the courtroom how his hands are tied because he can’t send a company to jail. Earlier this year, in his most severe berating of the company so far, he hypothetically asked what more he can do.

“Does the judge just turn a blind eye and say, ‘PG&E, continue your business as usual. Kill more people by starting more fires?’” Alsup said.

He regularly invokes an understanding of the threat posed to and by California’s natural environment, an appreciation captured in more than a dozen large black and white photographs he took that are framed and hung in the courthouse attorney’s lounge one floor below his chambers.

Alsup has threatened criminal sanctions and fines, which would seem to be of diminishing value after each new fire threatens to undermine an already tenuous company reorganization.

“If PG&E were a person as opposed to a company it’d be put in jail -- it would no longer be burning down whatever percentage of California,” Wara said.

“You have a company providing an essential service and because of its corporate form, you can’t put anyone in jail even if it does commit crimes or criminal negligence,” he added. “I imagine that must be deeply frustrating.”

The case is U.S. v. PG&E Corp., 14-cr-0175, U.S. District Court, Northern District of California (San Francisco).

©2019 Bloomberg L.P.

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