Can the CA govt just impose prohibitive fire prevention liabilities on utility companies, bankrupt them, and scoop up the assets for free?
PG&E already went bankrupt recently, and taking over the whole state wouldn't really help very much. The problem is largely liability rules that make it very expensive to provide power to wildfire zones and rural areas. PG&E and the state have decided to pay for that by charging people who live in cities very high rates for electricity. It's perverse that people who live in safe, urban areas are subsidizing people wh…
- Urban customers should have an incentive to use electricity over gas, which they would if rates were reasonable.
- Urban customers should not pay per kWh even if one thinks they should subsidize rural customers. It should be some kind of tax with reasonable allocation.
- Undercharging rural customers for provision of service and overcharging per kWh messes up incentives, too. If suburban or rural communities faced the actual cost of transmission to their area and distribution within it, they could make real decisions, for example:
# Technologies exist to reduce the risk that a power line fault starts a fire. Search for “ground fault neutralizer” or “REFCL.” Similarly common reclosers take a very YOLO approach to deal with a faulted line, and other approaches exist. PG&E, of course, doesn’t want to use these because the ridiculous CPUC rules let them make more profit by spending more money trimming trees.
# Communities could maintain their own lines and have actual locally enforced codes about vegetation.
# Communities could install batteries at their end of transmission lines to help ride through public safety power shutdowns and to level out their own loads. And they could even build small wind turbines optimized for operation in high winds (which are rather strongly correlated with those shutdowns) to generate a few MW and keep those batteries charged. Heck, this could be automated: de-energize the line when the wind is high automatically, and there won’t even be a substantial inrush when re-energizing when the wind stops because the batteries can reduce load to zero.
# A community could decide the cost isn’t worth it and build its own mini grid. This might spur interesting investment into things like small modular reactors :)
- The ownership and regulatory structure right now sucks, amplifying all the problems above and the lack of real solutions.