PG&E to scale back spending following wildfire liability bill failure

...announcement from PG&E. The utility says it has launched a strategic review and will defer about $2 billion in spending for the next year. This comes after an amended state Senate bill raised concerns around wildfire liability costs. KTVU's Tom Vacar joins us now from Nevada with how today's announcement is affecting customers. Tom? Well the announcement was made by PG&E's chief executive, Patty Poppe. It sure sounds a bit ominous. This is a serious moment, but I believe it can also be a turning point. We're in the fourth year of no major wildfires caused by our equipment. What then is so serious? We're unable to fund the continued transformation at our current pace. PG&E stock dropped 10% since Monday after it told investors it was deferring some $2 billion in capital expenditures, which possibly might include wildfire resistance projects next year. It turns out that all that ratepayer money can run normal company operations, pay 29,000 employees to do it, and make a profit for shareholders. But, says the CEO, it's not enough to fund new equipment for growth, wildfire safety, and reliability. That's why we must raise billions of dollars more every year. The people who fund building that equipment, banks and investors, face more risk here. But, because of the way California law assigns the cost of wildfire to utility customers and investors, risk goes up for both of them, unlike in any other state. When risk goes up, lenders charge more. Lenders can simply invest elsewhere or demand even more money, which PG&E cannot afford. Knowing this, the legislature consider it, but... The legislature adopted nothing. Mark Toney, a frequent PG&E critic, says things the Tern wanted to keep the California wildfire fund able to cover liabilities caused by electric utility equipment were also ignored. We need a plan that makes sure that the $40 billion last and doesn't get depleted. And that didn't happen. Tern's position is that PG&E should live within the money it has and quit the slow, expensive process of burying power lines. At a cost of $4 million a mile, and we're going to replace those with insulating overhead power lines, insulated poles, at one-fifth of the cost and it can be done much faster. Now PG&E says wildfire work will be maintained, but the other work, including booking new customers, or maybe connecting clean energy projects to the grid, or making upgrades to support large loads such as EVDs.