As PG&E files for Chapter 11 protection, environmental activists are worried their pool of green energy money is going to dry up.
Last November, large sections of California became a hellscape as wildfires devastated areas that have suffered drought conditions, overgrown brush, and environmental restrictions that prohibited appropriate forest management plans from being implemented.
Pacific Gas and Electric (PG&E) has been the focus of lawsuits related to the Camp Fire. The complaints allege that the utility failed. to properly maintain its infrastructure and equipment.
Now, PG&E has filed for Chapter 11 bankruptcy protection.
The San Francisco-based company listed more than $50 billion in estimated liabilities. A Chapter 11 filing allows a company to keep operating while it works out a plan to turn the business around and pay off creditors.
California’s wildfires have in the past saddled utilities with millions of dollars in damages, but never have the blazes exacted such a massive financial toll from a company—creating one of the country’s largest utility bankruptcies of all time. Since November’s Camp fire, which destroyed the town of Paradise, PG&E has seen about three-quarters of its market value wiped out, its chief executive officer leave, its bonds plunge to junk status and estimates of its fire liabilities swell to more than $30 billion.
Environmental activists are now worried that PG&E’s filing will defund green energy projects.
“It’s not just business. The state’s environmental and climate goals are at stake,” said John White, executive director of the Center for Energy Efficiency and Renewable Technologies, a non-profit group in Sacramento.
“How are we going to finance all of the clean energy initiatives we need?”
In stacks of court documents, PG&E asked a bankruptcy court to allow it to potentially cancel up to $42 billion in contracts that it signed over the past 15 years to buy electricity from other companies. Seventy-seven percent of those 387 contracts, or 298, commit PG&E to purchase solar, wind or other renewable energy to meet California’s environmental goals, according to its bankruptcy filing.
And many of the deals — known as “power purchase agreements” — were made when clean energy was much more expensive and locked PG&E into agreements for 15- to 20-year periods.
The deals helped finance construction of large solar and wind farms across the state.
I assert that the monies that went into those projects would have been better spent on infrastructure maintenance and fire prevention actions that would have spared Californians the horror of those historic blazes. West Virginia’s conservative pundit Don Surber makes the same point:
Instead of spending $42 billion on bogus energy production, the company should have spent a couple of billion bucks making sure its power lines are safe.
But then California would not have the forest fire to “prove” the conspiracy theory about global warming, which led to all that money blown on windmills and mirrors.
California’s bureaucratic behemoth, the Air Resource Board, implements its “cap and trade” scheme to control carbon emissions. However, the carbon emissions from the wildfires dwarfed those from standard anthropogenic sources. The 2018 fires released the rough equivalent of about 68 million tons of heat-trapping carbon dioxide, about the same amount of carbon emissions as are produced in a year to provide electricity to the state.
The monies for those credits and compliance requirements could have also been used to implement programs to reduce the risk of wildfires.
Companies do have limits to how much money they can spend. If firms are forced to fund competing business models and bureaucratic schemes based on questionable science, it diverts fiscal resources from programs essential to maintaining the equipment, processes, and personnel necessary to run the enterprise safely.DONATE
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