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>The author estimates that electricity prices would be reduced by up to 33% (from $0.45 blended rate to $0.30), but PG&E’s profit margins are only 11%. That’s a

>The author estimates that electricity prices would be reduced by up to 33% (from $0.45 blended rate to $0.30), but PG&E’s profit margins are only 11%. That’s a good hint that this hypothetical is missing some important details PG&E customers are paying very large amounts for the consequences of bad infrastructure causing wildfires and other legal costs which are being paid for with higher rates. Example: https://www.ewg.org/news-insights/news-release/2022/12/pge-asks-california-regulators-recover-136b-ratepayers-cost https://www.ewg.org/news-insights/news-release/2022/12/pge-a...

Aurornis 2y ago
Right, but that’s my point: You can’t assume these costs disappear if the government takes over. They just get blended into the tax bill.
- necubi 2y ago
  He’s talking about local governments in places that have little or no fire risk. Should people living in dense cities be paying to underground power lines to rural communities hundreds of miles away?
- colechristensen 2y ago
  PG&E is a private company, much of the responsibility for their wildfire costs are the result of mismanagement of the risks. Their costs get shouldered by their customers and their stock price. (they really should issue shares to pay their bills to dilute their stock price and cause their existing investors to lose money). In any case it's not going to get very willingly picked up by the government. PG&E's liabilities aren't going to be put into taxes. It's not the state government taking over PG&E, it's individual municipalities leaving the PG&E network and forming their own utility to buy wholesale electricity (or make some of their own) and distribute it to their citizens... resulting in a large reduction in cost in no small part because they no longer have to pay for PG&E's liabilities.
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Aurornis 2y ago

Right, but that’s my point: You can’t assume these costs disappear if the government takes over. They just get blended into the tax bill.

necubi 2y ago
He’s talking about local governments in places that have little or no fire risk. Should people living in dense cities be paying to underground power lines to rural communities hundreds of miles away?
colechristensen 2y ago
PG&E is a private company, much of the responsibility for their wildfire costs are the result of mismanagement of the risks. Their costs get shouldered by their customers and their stock price. (they really should issue shares to pay their bills to dilute their stock price and cause their existing investors to lose money). In any case it's not going to get very willingly picked up by the government. PG&E's liabilities aren't going to be put into taxes. It's not the state government taking over PG&E, it's individual municipalities leaving the PG&E network and forming their own utility to buy wholesale electricity (or make some of their own) and distribute it to their citizens... resulting in a large reduction in cost in no small part because they no longer have to pay for PG&E's liabilities.

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