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PG&E has been paying out dividends and executive bonuses instead of reinvesting in their infrastructure for years. And bought off a number of state politicians.

PG&E has been paying out dividends and executive bonuses instead of reinvesting in their infrastructure for years. And bought off a number of state politicians. Now that climate change is creating conditions for the already wildfire-prone landscape of California to suffer more frequent and severe events, the power companies are washing their hands of it. Short of some major state or federal investment in upgrading energy infrastructure (like the green new deal), I wouldn’t expect that to change.

paganel 7y ago
> PG&E has been paying out dividends and executive bonuses instead of reinvesting in their infrastructure for years. And bought off a number of state politicians. Re the dividends part, that's an issue on which our present society will have to work more and more, because afaik most of those dividends go into the coffers of pension funds/insurance companies/big institutional investors which by their very nature "trickle down" that money mostly to people aged over 45 or 50. Most of those reinvestments you mention will get their financial return in 20-30 years' time, by which point the age-group I mentioned earlier (the over 45-50) will either be dead or to old too care that much about it.
- torpfactory 7y ago
  Shouldn’t PGE forgo payouts to shareholders in order to keep infrastructure to a better standard? Surely the long term value of PGE is diminished (and thus their ability to pay dividends) if they are found liable for fires or effect rolling blackouts as a “solution”. The pension funds could invest in something else instead.
  - javagram 7y ago
    They suspended dividends two years ago https://www.sfchronicle.com/business/article/PG-E-suspends-dividends-over-possible-wildfire-12445592.php https://www.sfchronicle.com/business/article/PG-E-suspends-d...
- mikorym 7y ago
  RE: pension funds; that is something that bothers me eternally. How do you find a store of wealth for normal people? Financial managers have opted for shares and bonds and in the process risk economic instability through overvaluation. The French, being the French, instead makes you pay the current people's pension in taxes and in turn promise to do the same when you are a pensioner. Let's hope they don't do it "the South African way".
jeanvalmarc 7y ago
Bonuses are something that’s easy to get outraged by, but look like an infinitesimal fraction of the business numbers. A judge approved a $235M bonus structure across 10,000 employees[1], while the wildfire liabilities are at least $18B [2], their 4-year infrastructure investment plan is $28B [3], and their top-line annual revenue is $17B. How many competent execs are going to want any part of that shitshow? $235M doesn’t sound like enough… [1] https://www.sfchronicle.com/business/article/Judge-approves-235-million-in-bonuses-for-10-000-13789966.php https://www.sfchronicle.com/business/article/Judge-approves-... [2] https://www.latimes.com/business/story/2019-09-09/pge-looks-to-cap-wildfire-costs https://www.latimes.com/business/story/2019-09-09/pge-looks-... [3] https://www.pge.com/en/about/newsroom/newsdetails/index.page?title=20190422_pge_submits_updated_financing_proposal_for_safety_and_reliability_infrastructure_investments_for_16_million_customers_commits_to_working_toward_long-term_policy_solutions_to_best_serve_interests_of_customers_utility_and_california https://www.pge.com/en/about/newsroom/newsdetails/index.page...
- ncmncm 7y ago
  Dividends was listed before bonuses. It is clear that the primary role of the bonuses is to generate outrage at them giving themselves bonuses for such bad performance. Dividends have been very substantial, and evidently outcompeted maintenance. The lawsuits will collect more data in discovery. Make no mistake, the outage and the threat are attempts at coercion, trying to force California to indemnify them, for free, against their own very deliberate negligence. If PGE does not want to be a public utility anymore, California should confiscate their assets and turn them over to someone who does.

paganel 7y ago

> PG&E has been paying out dividends and executive bonuses instead of reinvesting in their infrastructure for years. And bought off a number of state politicians. Re the dividends part, that's an issue on which our present society will have to work more and more, because afaik most of those dividends go into the coffers of pension funds/insurance companies/big institutional investors which by their very nature "trickle down" that money mostly to people aged over 45 or 50. Most of those reinvestments you mention will get their financial return in 20-30 years' time, by which point the age-group I mentioned earlier (the over 45-50) will either be dead or to old too care that much about it.

torpfactory 7y ago
Shouldn’t PGE forgo payouts to shareholders in order to keep infrastructure to a better standard? Surely the long term value of PGE is diminished (and thus their ability to pay dividends) if they are found liable for fires or effect rolling blackouts as a “solution”. The pension funds could invest in something else instead.
- javagram 7y ago
  They suspended dividends two years ago https://www.sfchronicle.com/business/article/PG-E-suspends-dividends-over-possible-wildfire-12445592.php https://www.sfchronicle.com/business/article/PG-E-suspends-d...
mikorym 7y ago
RE: pension funds; that is something that bothers me eternally. How do you find a store of wealth for normal people? Financial managers have opted for shares and bonds and in the process risk economic instability through overvaluation. The French, being the French, instead makes you pay the current people's pension in taxes and in turn promise to do the same when you are a pensioner. Let's hope they don't do it "the South African way".

jeanvalmarc 7y ago

Bonuses are something that’s easy to get outraged by, but look like an infinitesimal fraction of the business numbers. A judge approved a $235M bonus structure across 10,000 employees[1], while the wildfire liabilities are at least $18B [2], their 4-year infrastructure investment plan is $28B [3], and their top-line annual revenue is $17B. How many competent execs are going to want any part of that shitshow? $235M doesn’t sound like enough… [1] https://www.sfchronicle.com/business/article/Judge-approves-235-million-in-bonuses-for-10-000-13789966.php https://www.sfchronicle.com/business/article/Judge-approves-... [2] https://www.latimes.com/business/story/2019-09-09/pge-looks-to-cap-wildfire-costs https://www.latimes.com/business/story/2019-09-09/pge-looks-... [3] https://www.pge.com/en/about/newsroom/newsdetails/index.page?title=20190422_pge_submits_updated_financing_proposal_for_safety_and_reliability_infrastructure_investments_for_16_million_customers_commits_to_working_toward_long-term_policy_solutions_to_best_serve_interests_of_customers_utility_and_california https://www.pge.com/en/about/newsroom/newsdetails/index.page...

ncmncm 7y ago
Dividends was listed before bonuses. It is clear that the primary role of the bonuses is to generate outrage at them giving themselves bonuses for such bad performance. Dividends have been very substantial, and evidently outcompeted maintenance. The lawsuits will collect more data in discovery. Make no mistake, the outage and the threat are attempts at coercion, trying to force California to indemnify them, for free, against their own very deliberate negligence. If PGE does not want to be a public utility anymore, California should confiscate their assets and turn them over to someone who does.