John Texeira's opinion piece ("California's green energy scam," Oct. 24) appears to be based on his belief that a government conspiracy to take over the utility industry exists. He uses the hot-button word "socialism" to try to scare the reader into buying in to that conspiracy theory. However, socialism has nothing to do with regulation or deregulation and should not be part of the conversation.
People older than 35 may well remember a time when all utilities were regulated by government, and costs were so reasonable that one barely had to consider "water and power" when creating a budget. However, all that has changed. We are now held hostage to the whims of a vast bloated industry that, without regulation, stabs itself in the foot over and over and expects its consumers to pay the bill.
California's deregulation fiasco began in 1996. Then Gov. Pete Wilson allowed the state's three dominant utilities to join forces and together shake down their ratepayers through "the largest corporate ripoff in American business history," according to Ralph Nader. The price tag for Californians was between $20 billion and $30 billion in "stranded costs"—i.e., direct paybacks to the utilities for their bad generating plants. These charges continue to be levied on customers through surcharges buried in customers' bills at the rate of about 30 percent of monthly payments.
The California wildfires raging now, and in the past several years, have often been caused by faulty PG&E equipment—equipment that the company well knows is sub-standard, aged-out, and extraordinarily dangerous.
The distribution companies create panic via bankruptcy with huge paper losses, but the parent companies continue to suck up huge profits without any accounting for the stranded-cost money they've hidden in foreign and out-of-state investments. This is the utility's ploy to get out whole, confuse the consumer, and avoid consequence.
These utility hogs don't need our money. They want it. They demand it. And to cover their bottoms, they will raise costs again.
As of Jan. 16, 2019, PG&E Corporation had a market capitalization of $3.24 billion. As of Feb. 27, 2019, PG&E Corporation and the utility had unconsolidated cash and cash equivalent balances of approximately $480 million and $1.7 billion, respectively. As of 2020, PG&E plans to increase costs to consumers as follows: for wildfire safety (upgrading of their own equipment), a 6.8 percent increase; for liability insurance (for the fires they cause), a 3.2 percent increase; and for core gas and electric operations (legitimate ops), a 2.4 percent increase. The figures yield a total increase to your utility bill of 12.4 percent, with 9.2 percent of that being cover for their own management failures.
While PG&E pays property taxes, as we all do, 2017 marked the 10th straight year in which the company reported a federal income tax bill of zero despite being profitable every year, according to the Institute on Taxation and Economic Policy. The company's $14.5 billion of income in the prior decade resulted in a net tax rebate of almost $1.7 billion. Due to the 2017 Trump tax break reform for the uber-rich, PG&E's accelerated depreciation tax break will be ever more generous going forward, and the tax-avoiding prospects of the company pretty much glow in the dark at this point.
Regulation of industry is neither socialism nor government conspiracy, and "green energy" has nothing to do with it. When it comes to PG&E and their brethren, this is corporate greed run rampant. Δ