PG&E Put in Hot Seat by Judge Over Fire Hazard From Power Lines

(Bloomberg) -- A federal judge probing whether PG&E Corp. was criminally negligent in causing some Northern California wildfires is asking prosecutors whether uninsulated power lines are the root of the problem.

If U.S. District Judge William Alsup is correct that sparks from uncovered lines running through rural areas with dense vegetation pose “an extreme danger of igniting a wildfire,” that could spell more trouble for the embattled company as prosecutors scrutinize whether it broke the law through reckless operation of the electric grid.

“Whether that becomes a grounds for criminal prosecution, that’s a very good question,” said Mike Danko, a lawyer representing thousands of victims of the 2017 and 2018 fires who are suing the utility.

PG&E said in December -- a month after the deadliest and most destructive fire in California history destroyed the town of Paradise -- that it plans to install insulated power lines across 7,000 miles of highest-fire risk areas over the next 10 years, among other safety upgrades. It’s a costly undertaking and the company would need approval from state regulators to charge customers for it.

The company is reviewing Alsup’s latest order and continues to work with local and state officials “to develop comprehensive, long-term safety solutions for the future,” PG&E spokesman James Noonan said.

The San Francisco judge tentatively concluded Thursday that the “single most recurring cause” of the large fires attributed to PG&E equipment is distribution lines that are “almost always uninsulated” and are susceptible to being hit by trees or limbs on windy days. Alsup asked for the company and the U.S. Justice Department to comment by Jan. 23 on his findings and to be ready to discuss them further at a Jan. 30 hearing.

The judge is overseeing PG&E’s probation for its criminal conviction for safety violations following a 2010 gas pipeline explosion that killed eight people. Under the terms of probation, the company is forbidden from committing new crimes.

Danko said internal company documents released in the civil litigation reveal that PG&E weighed three options for mitigating fire risk and chose the cheapest. The utility opted for intensifying vegetation management over installing more insulated lines and an even more expensive alternative, burying lines underground. But the company’s risk managers calculated that even with careful trimming of trees and bushes a catastrophic fire would occur every 30 years, he said.

Danko said the documents show the company decided “to accept the risk of a wildfire.”

PG&E isn’t the only California utility that’s committed itself to reducing fire risk following a spate of massive wind-whipped blazes that have destroyed thousands of dwellings and killed scores of people.

Edison International’s Southern California Edison unit, which faces its own flood of fire claims over the last two years, proposed in 2018 to replace almost 600 miles of conductors in high-fire risk areas with insulated wires by the end of 2020 as a part of a $582 million grid safety plan filed with state regulators.

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