California utilities penalized $22M over 2020 power shutoffs

The California Public Utilities Commission (CPUC) announced Wednesday it had imposed more than $22 million in fines against several utilities for alleged violations from public safety power shutoff (PSPS) events in 2020.

In a release, the group said that the administrative enforcement orders require Pacific Gas & Electric (PG&E) to shell out $12 million, Southern California Edison to pay $10 million and San Diego Gas & Electric to surrender $24,000. 

The orders are issued under the CPUC's enforcement policy, and the action marks the first time an administrative enforcement order has been used. 

Under the order, the utilities have 30 days to pay the fines to the state’s general fund and make the corrective actions or request a hearing.

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"The 2020 PSPS season consisted of 26 separate PSPS events across the service areas of all four utilities," the commission said. "The CPUC’s safety and enforcement division conducts analysis of utility PSPS events to ensure utilities are complying with CPUC guidelines. 

"The safety and enforcement division’s analysis of the 2020 PSPS events uncovered multiple violations of CPUC PSPS guidelines. The administrative enforcement orders issued today address these violations through fines and corrective actions."

PacifiCorp power company was also ordered to take corrective action.

In a statement provided to FOX Business Thursday, a spokesperson for Southern California Edison said the the administrative enforcement order was "counter-productive" because it focuses on the early stages of the utility's PSPS program and "not on the tremendous progress" made to improve the PSPS process and minimize customer impact since then.

"We understand that PSPS events create hardships for our customers and have heard a clear message from customers, regulators, government officials and public safety partners that the company must do more to reduce the need for PSPS and provide increased support to customers and improve our outreach when PSPS events do occur," the statement said. 

The spokesperson said that while the company takes this sentiment to heart, the penalty by the CPUC recommended for the alleged PSPS-related violations in 2020 is "excessive and unnecessary." 

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"The rules governing PSPS were still evolving, and the company has made significant improvements and progress since those PSPS events. Rather than focusing on our challenges and opportunities ahead, the AEO seeks to impose an unfair penalty and overlooks completely the improvements made in the last year and a half," the Southern California Edison spokesperson asserted.

The spokesperson cited grid-hardening improvements in 2021 that yielded a 73% reduction in the duration of PSPS events for the most frequently impacted circuits and the removal of 81,000 customers from PSPS scope. 

In addition, since 2020, Southern California Edison said it had improved customer notifications and increased outreach.

"While we are still reviewing the proposed order on our 2020 public safety power shutoffs, it appears the focus was on our reporting and customer notification processes, a spokesperson for San Diego Gas & Electric told FOX Business. "We are always looking to evolve our processes and innovate our operations because the safety of our customers and the communities we serve remains our top priority."

All three companies were criticized for their handling of PSPS events in October 2019 that were designed to deactivate power lines during hot and windy weather conditions to prevent downed equipment from sparking wildfires.

In 2021, the CPUC penalized PG&E $106 million for violating guidelines during fall 2019 power shutoffs.

Later shutoffs went more smoothly.

According to the CPUC, power lines have been blamed for about half of the Golden State's most destructive wildfires, but scientists say that climate change has made fires more frequent and intense. 

PG&E told FOX Business Thursday it had made improvements to its PSPS tool.

"We know that losing power disrupts lives, and we are continuing to apply lessons learned, make improvements and refine the PSPS program to reduce impacts on our customers, as well as provide accurate and timely notification to all customers, public safety partners, regulators and other impacted stakeholders," a PG&E spokesperson said. "We are working year-round to make our system safer and more resilient and improve PSPS for our customers and hometowns. We are reviewing the CPUC’s order and will respond within 30 days as required."

Notably, PG&E is working to bury thousands of miles of power lines in an effort to prevent starting fires and avoid electricity shutdowns.

A spokeswoman for the company told The Associated Press that underground power lines reduce ignition risk by 99%, with the process costing $3.75 million per mile. 

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Since 2017, equipment has been blamed for more than 30 wildfires that have wiped out more than 23,000 homes and businesses and killed more than 100 people. 

PG&E filed for bankruptcy following billions in wildfire fines and lawsuits in 2019.

The Associated Press contributed to this report.