PG&E Could Put Power Lines Underground, But It's Very Expensive

(Bloomberg) -- PG&E Corp.’s multibillion-dollar bankruptcy Tuesday was triggered by potential liabilities from wildfires sparked by its above-ground power lines. So why doesn’t the utility just bury them?

It boils down to cost. While putting lines underground would shield them from wind storms that spread the fires, burying all of PG&E’s overhead transmission lines could cost more than $67 billion, said James Sprinz, head of decentralized energy research at BloombergNEF. The utility had a $1.1 billion budget for transmission capital costs in 2016, its peak capital-spending year, he noted.

But many Californians are calling for more lines to be moved underground, and PG&E already faces an estimated $30 billion in liabilities from wildfires. State fire investigators have blamed many recent fires PG&E’s power lines arcing, falling and getting tangled in trees during California’s periodic wind storms.

It’s not an easy fix, Sprinz said, and expenses vary by the type of line. Installing a 230-kilovolt transmission line, for example, costs the utility about $320,000 per mile ($200,000 per kilometer), but putting a same-sized line underground would have a price tag of more than $2.6 mil lion per mile. The differential for a 115-kilovolt line is even higher, with the underground version costing 36 times as much as the overhead.

“Undergrounding PG&E’s transmission system might help with reliability and reduce wildfire risks, but the costs would be enormous,” Sprinz said. “The cost of undergrounding distribution would run higher still.”

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