Photo: A rally in front of the California Public Utilities Commission against PG&E rate hikes. Liberation photo.
As our campaign to abolish the nation’s largest and deadliest utility monopoly continues, there is a consistent theme among those we talk to: a visceral hatred of Pacific Gas & Electric.
In San Francisco, when talking to people in my own neighborhood – the Mission District – we often hear from single mothers, college students, long-term residents, and families of all kinds that their PG&E utility rates have skyrocketed while their paychecks have remained stagnant.
The horror stories we’ve heard from the residents of Santa Rosa and Clearlake are even worse. Wildfires caused by PG&E equipment force families to evacuate their homes, and when the smoke clears, many of them have nothing to return to. The utility, which caused the fires by neglecting to inspect and maintain century-old power-lines, provides zero support to the people who have been displaced or even rendered homeless. Instead, PG&E rapidly increases electricity rates, putting people in an even more precarious situation.
Recently, it’s been reported that PG&E is charging some people almost $1,000 a month for electricity in Central Valley, a predominantly working-class part of the state. Triple-digit temperatures this summer have created an essential need for power. Despite uncomfortable and unsafe temperatures, residents often try to save money by forgoing their air conditioning. Some families even choose to skip meals or prescribed medicines to make sure they can afford to pay their energy bills. Once a family falls behind on their bills, PG&E will shut off their power entirely and hardships increase: food spoils, medical devices can’t function, phones can’t be charged, water can’t be heated. In 2023, PG&E shut power off over 166,000 families who couldn’t keep up with their outrageous prices – 17% of these shut offs were still shut off 3 months later. While working people agonize over which necessities they’ll be able to afford and which they’ll have to cut each month, PG&E investors and executives rake in the cash. CEO Patricia Pope took $17 million in the 2023 fiscal year – over 60 times the wage of the average PG&E worker. In the same year, $1.8 billion in profits went straight into the pockets of shareholders as dividends. As they force families to go months without power, they float around the world on mega yachts.
PG&E Electricity Rates 2008-2024. Source: pge.com
Why do our rates continue skyrocketing while service and safety aren’t improving?
There’s the corporate spin and then there’s reality. PG&E says they have to fund the Community Wildfire Safety Program, a program that was developed after the catastrophic 2017 North Bay fires and 2018 Camp Fire, which alone killed over 80 people, destroyed over 18,000 structures, and hundreds of thousands of acres were burned. Our campaign demands that PG&E should right its wrongs when it comes to wildfire mitigation, but reducing wildfire risk stemming from its energy infrastructure should not happen on the backs of poor and working Californians who are struggling to keep the lights on. So then why are working-class ratepayers having to bear this financial burden instead of Geisha Williams, President and CEO of PG&E from 2017-2019, or David Gabbard, Senior Director of Transmission Asset Management, who both ran PG&E’s century old equipment into the ground to save costs and rake in higher profits for investors. People died because of these profit oriented decisions and we had to pay for it all.
As of March 31, just three months into the year, PG&E reported $5 billion in profits. They have a track record of not investing in upgrades to the electrical grid or putting power lines underground — two things that would drastically reduce the risk of sparking more devastating wildfires. It’s no wonder utility debt for California customers is nearly $3 billion and continues to rise.
There is an inherent contradiction within the capitalist system where private companies control our basic necessities, forcing us to pay ever higher prices for clean water, clean air, electricity, housing, education, and more, all to enrich the small few of the ruling class. It’s an odd system we live under, that all of our basic necessities are commodified, and if we don’t have money, we cannot survive. Under the inhumane system of capitalism, PG&E has monopoly control on your ability to power your lights, turn on your oven, or use your water heater and they have full control on how much they profit off of you simply trying to meet your basic needs.
It is their job to make a profit. It is not their job to worry about safety. This is exactly why we need nonprofit utilities because they would not be driven by the need to make a profit, but would be driven by public service. From a capitalist perspective, profit is the only way to survive, let alone thrive, in the competitive market and therefore profit is the bottom line — it is all that matters. Instead of reinvesting the billions of dollars that companies like PG&E have made off of our energy usage into upgrading the grid and undergrounding power lines, they have lined the pockets of their investors.
The $5 billion in profits already made by PG&E in the first three months of 2024 could have been spent on upgrading infrastructure, mitigating fire risk, and boosting climate resilience across Northern California. Instead our rates have gone up 13% — around $35 every month — as PG&E seeks higher profits by pushing the Community Wildfire Safety Program costs onto rate payers. Blaming upgrades to the system as the cause for rising rates is absurd while raking in billions of dollars in profits and using all of it to enrich hedge fund investors.
It is clear that PG&E will never be accountable to the people or the California Public Utilities Commission, a public accountability arm of the state that has completely lost its fundamental purpose by becoming bedmates with PG&E. Only when PG&E is turned over to the people, to be democratically owned and managed, will we have a utility that is accountable to the ratepayers and governing bodies. We will also have a utility that is not run to make profits, but is run to provide the energy needs of California residents.
Enter, Golden State Energy. In 2020, California Governor Gavin Newsom passed SB 350, a law that targets corporate negligence by allowing the state government to convert PG&E into a nonprofit if it fails to provide safe and reliable power to customers. “No more business as usual for PG&E,” said Newsom, adding that the bill’s passage marked a “critical step in the transformation of PG&E into a utility that is accountable to those it serves — the people of California.”
Currently PG&E is only held accountable to shareholders, a majority owned by a small group of finance banks: Vanguard, Fidelity, BlackRock, JPMorgan, and Capital.
“There’s no motivation to maximize returns and extract value [for publicly-owned utilities] from the community because all [of the board’s] activities are for the benefit of people in OPPD territories,” Eric Williams, board member at Omaha Public Power District Board (OPPD), told Energy News last year.
Golden State Energy would also be based on public benefit, avoiding the profit model by investing any profits made back into the system itself.
Having a public utility like Golden State Energy would be similar to how energy is provided in a socialist society. Under a socialist economy, energy democracy would become a reality as energy access would be a human right. Democratically controlled and operated energy systems would power all of our communities. Every household and business would have access to safe and reliable energy and public safety and environmental protections would be centered rather than corporate greed and investor dividends. This socialist future is not only necessary, especially as climate change intensifies and the capitalist solutions fail, but is also possible.
Under capitalism, there is little incentive for corporations like PG&E to invest in public health and wellbeing — like clean energy development — because it would mean lower dividends for shareholders. That’s also why, instead of using the wealth they have already collected from ratepayers, they are raising rates and pushing these costs onto all of us.
Within the profit-driven capitalist system, the essential problems of an IOU utility, like PG&E, are impossible to fix as they will always be driven by insatiable greed and not public safety. We must demand the implementation of Golden State Energy as the state’s utility provider for a just energy system. Join us in that fight.
