TURN Opposes AB 235 (Mayes) as a Ratepayer Bailout of PG&E Shareholders

For Immediate Release from TURN, The Utility Reform Network

Thursday, August 22, 2019, San Francisco–Convicted felon PG&E is once again lobbying the state legislature for a bailout.  In a repeat of the 2018 campaign it spent millions on, PG&E wants customers to act as guarantors of  $20 billion more, urging lawmakers to further protect its shareholders at the expense of its customers.  Should PG&E shareholders default on their payments due to continued wildfire safety negligence or poor management decisions, the bondholders are not at risk of getting stiffed because ratepayers serves to guarantee payment.

“Lawmakers should simply shut their doors to PG&E,” said TURN executive director Mark Toney.  “Ever since the Tubbs fire PG&E has had a single-minded focus on using its liabilities to extract as much money from customers as possible. Even after succeeding in getting self-serving legislation in 2018, and even after choosing to declare bankruptcy despite that, PG&E’s campaign of shareholder greed has continued unabated.

Toney said PG&E’s claims that its latest proposal for a bond bailout would be “ratepayer neutral” were patently absurd. “The only way to make the bonds ratepayer neutral is for the hedge funds who comprise the majority shareholders to put up their own assets as loan collateral, and not depend on ratepayers as guarantors.”

Customers are already facing huge rate hikes, and wondering where their money is going, as revelations about PG&E’s safety failures continue unabated and the company threatens massive shutoffs.  “TURN hears from customers every day that they are sick and tired of paying top dollar for PG&E’s unsafe and substandard service. With trust of PG&E at an all-time low, and rates at an all-time high, legislators will be hard pressed to find sympathy for the company among their constituents,” he added.

Toney noted that previously approved AB 1054 was meant to put any bailout demands to rest.  “The way is clear for PG&E to access the wildfire insurance fund in the future.  Instead of trying to get new laws written to benefit its corporate investors, PG&E should start following the existing law,” he said.  “And lawmakers should not take their lead from a company that has broken the law again and again.”