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Those dividends are necessary to raise the private capital necessary to run PG&E. It's not a charity, and it's certainly not a "market." It's a state-sponsore

Those dividends are necessary to raise the private capital necessary to run PG&E. It's not a charity, and it's certainly not a "market." It's a state-sponsored monopoly. The only other ways to fund it are increased energy prices or tax dollars.

dragonwriter 7y ago
> Those dividends are necessary to raise the private capital necessary to run PG&E. Private capital is only required to have someone to return dividends to. > It's not a charity Yes, exactly, because it's a for profit institution, it is structurally incentivized to return profits to investors. > It's a state-sponsored monopoly. Which makes it being a private, profit-making enterprise nonsensical, exactly.
- TheHypnotist 7y ago
  You mention profit a lot, but do you know how a utility earns money? Rate payer might be the obvious answer, but there is another. Capital projects, investments into itself that make the company tick. New plants, improve infrastructure (down to the application server). See: https://blog.aee.net/how-do-electric-utilities-make-money https://blog.aee.net/how-do-electric-utilities-make-money Now, that doesn't excuse them because its entirely possible they did not invest wisely. But simply blaming "profit" is hand wavy anti-corporate speak, which doesn't necessarily explain what is happening.
  - dragonwriter 7y ago
    > You mention profit a lot, but do you know how a utility earns money? Rate payer might be the obvious answer, but there is another. No, there isn't. > Capital projects, investments into itself that make the company tick. That doesn't make money, it reduces operating expenses and increases operating margins at the same rates. The money still comes from ratepayers. And public entities reduce operating expenses the same way, the benefits (after paying for any debt financing) just go to taxpayers, rather than private investors.
    - TheHypnotist 7y ago
      I said earn money. But I phrased it poorly, so i'll explain further with what I know. I also assume we're still talking about regulated utilities. Capital project costs (along with other fixed costs) generally get passed through to rate payers + an approved ROR by the public utility board. Operating expenses cut into this. Capital project costs do not necessarily reduce operation expenses directly.
- hcurtiss 7y ago
  Everything about the utility, including the rate of return to the investors, is approved by the public utility commission. If you cut off that rate of return, you have no more private investors.

dragonwriter 7y ago

> Those dividends are necessary to raise the private capital necessary to run PG&E. Private capital is only required to have someone to return dividends to. > It's not a charity Yes, exactly, because it's a for profit institution, it is structurally incentivized to return profits to investors. > It's a state-sponsored monopoly. Which makes it being a private, profit-making enterprise nonsensical, exactly.

TheHypnotist 7y ago
You mention profit a lot, but do you know how a utility earns money? Rate payer might be the obvious answer, but there is another. Capital projects, investments into itself that make the company tick. New plants, improve infrastructure (down to the application server). See: https://blog.aee.net/how-do-electric-utilities-make-money https://blog.aee.net/how-do-electric-utilities-make-money Now, that doesn't excuse them because its entirely possible they did not invest wisely. But simply blaming "profit" is hand wavy anti-corporate speak, which doesn't necessarily explain what is happening.
- dragonwriter 7y ago
  > You mention profit a lot, but do you know how a utility earns money? Rate payer might be the obvious answer, but there is another. No, there isn't. > Capital projects, investments into itself that make the company tick. That doesn't make money, it reduces operating expenses and increases operating margins at the same rates. The money still comes from ratepayers. And public entities reduce operating expenses the same way, the benefits (after paying for any debt financing) just go to taxpayers, rather than private investors.
  - TheHypnotist 7y ago
    I said earn money. But I phrased it poorly, so i'll explain further with what I know. I also assume we're still talking about regulated utilities. Capital project costs (along with other fixed costs) generally get passed through to rate payers + an approved ROR by the public utility board. Operating expenses cut into this. Capital project costs do not necessarily reduce operation expenses directly.
hcurtiss 7y ago
Everything about the utility, including the rate of return to the investors, is approved by the public utility commission. If you cut off that rate of return, you have no more private investors.