Judge blasts PG&E, which pushes back during contentious hearing

SAN FRANCISCO -- A federal judge blasted Pacific Gas & Electric Co. Wednesday for failing to do enough to reduce wildfire risk during a contentious hearing in which he contemplated proposals for violating its criminal probation.

The ideas included everything from prohibiting PG&E from starting a fire -- "one simple thing," U.S. District Judge William Alsup of San Francisco called it -- to an order for it to adopt another utility's policy of shutting off power during high-risk weather conditions.

"Every time I ask you to admit something, you say you're under investigation," he said. "Usually a criminal under probation is forthcoming and admits what they need to admit. ... There's a clear-cut pattern that PG&E is starting these fires."

Five years of probation was imposed on PG&E following a 2017 criminal conviction for its role in the 2010 San Bruno pipeline explosion.

Attorneys from the California Public Utilities Commission and the Department of Forestry and Fire Protection, as well as federal and county prosecutors and the lead plaintiffs' attorneys in pending civil lawsuits packed Alsup's courtroom to weigh in on what they think should be done to improve public safety concerning wildfires.

PG&E's mitigation plan is due Feb. 6.

With respect to Alsup's proposal, which includes a reinspection of PG&E's entire electrical grid to remove all vegetation that could impair electrical operations, defense attorney Reid Schar of Jenner & Block LLP said the utility has to proceed cautiously because there are several "cerebral policy decisions which have to factor in cost, liability and safety."

The initiative would take roughly eight years, according to PG&E attorneys. U.S. v. Pacific Gas & Electric Co., 14-CR00175 (N.D. Cal., filed April 1, 2014).

Alsup skeptically responded that "$4.5 billion has been paid out in dividends to shareholders," over the past five years. "Some of that could have been used to trim trees."

Another PG&E attorney, Kevin Orsini of Cravath, Swaine & Moore LLP who is lead counsel for the defense in the civil wildfire cases, cut in, saying the issue is not a matter of money but of finding qualified personnel, and the trees suspected of being ignited in wildfires over the last two years have "historically not needed to removed."

The "bigger issue we're confronting now" is that practices that have worked in the past are no longer sufficient in light of climate change and the drought, he said.

An example would be that state Public Resources Code 4293 does not require the trimming of "overhanging" branches if they are more than 4 feet from a power line, according to Orsini. PG&E's new "Conductor Sky Clearance" initiative would remove the vegetation even though it is not required by state regulators, he said.

When Orsini mentioned there were legal issues concerning other enhanced tree cutting measures the utility could take to more fully comply with the code in question, Alsup told him, "You spend so much money on lobbying, you could go to Sacramento today and get a law passed."

"One thing you haven't considered is this," Alsup added. "I could help PG&E on this, because if you had a strict order that you have to comply with 4293 or whatever rule, and some landowner tried to get in the way, you could apply immediately for the landowner ... to justify standing in the way of California preventing wildfires."

Pointing out there are complications from a regulatory standpoint to some of Alsup's proposals, namely with respect to trimming vegetation, Orsini said PG&E will also prioritize removing certain species of trees identified as high fire risk.

The judge requested a written brief from the state attorney general's office and the Department of Forestry on its interpretation of Public Resources Code 4293 by next week.

In an unexpected appearance, North Bay fire litigation lead plaintiffs' attorney Frank Pitre of Cotchett, Pitre & McCarthy LLP aggressively argued for PG&E to adopt the San Diego Gas and Electric Co.'s de-energization policy.

"SDG&E has had a de-energization policy since the 2011 wildfires, and since it has been adopted, San Diego has not seen a single wildfire," he said. "It has been viewed as the gold standard."

When combined with the sophisticated weather monitoring stations PG&E has said it uses, a de-energization policy whenever winds cross a specific high-risk threshold, such as 40 miles per hour, could keep inconvenience to a minimum, Pitre said.

When the judge called on California Public Utilities Commission attorney Christine Hammond to share her insight on the matter, she pushed back on Alsup forcing PG&E to adopt a stringent de-energization policy.

She said the court is not the correct forum to discuss the issue because "not all wildfires are started by utility assets" and there is "just more nuance that has to be considered."

"Pitre is saying de-energizing, as inconvenient as it is, is better than death and destruction," Alsup responded. "To me, I agree. That makes sense."

The 3 1/2-hour hearing also included a finding that PG&E violated its probation by neglecting to report to the court that the Butte County district attorney's office had been investigating the utility in connection with a possible role in the Honey fire in 2017.

PG&E attorneys sent the Department of Forestry's findings on the fire, which they thought was good enough to fulfill the terms of probation, according to Schar.

But probation officer Jennifer Hutchens testified, "At no time did I receive information that the Butte County DA's office had undertaken an investigation in that matter."

A sentencing hearing will be scheduled for next week.