Judge opts against extending PG&E criminal probation for violation

SAN FRANCISCO -- The federal judge overseeing the Pacific Gas & Electric Co.'s probation decided Tuesday not to extend the utility's court-mandated supervision.

Additional probation is "not the right answer in this case anyway," U.S. District Judge William Alsup of the Northern District said. He ordered the Pacific Gas & Electric Corp. board to appoint a committee to track progress implementing its wildfire mitigation plan.

The utility's board members must also tour Butte County, where PG&E's equipment is suspected of starting one of the state's worst wildfires.

"I just don't think PG&E has put safety first," Alsup said. "The ads all say it does, but if you look at the record, PG&E has allowed things to slide on the safety front, particularly on the fire part and cutting and trimming those trees."

Alsup imposed the sentence because of a probation violation after federal prosecutors discovered the utility did not report a settlement it reached with Butte County for a 2017 fire.

The judge wants PG&E executives to visit Paradise, which was ravaged by the 2018 Camp fire -- now the deadliest blaze in state history. It killed 85 people and destroyed roughly 14,000 homes.

The Department of Forestry and Fire Protection is still investigating the cause of the fire but PG&E has indicated it will likely be found responsible.

Alsup said PG&E leadership should "see the gravity of what happened up there" and that he will likely go as well. He proposed a bus tour on July 15.

"The board of directors ought to see firsthand the devastation," he said.

PG&E attorney Reid J. Schar asked the court to impose terms that "are at issue of the violation here," which was failure to report possible probation violations to court-appointed monitor Mark Philip of Kirkland & Ellis LLP, if it believes new conditions are necessary at all. He has maintained 9th U.S. Circuit Court of Appeals precedent prevents Alsup from extending the probation, which expires in 2022, beyond the statutory maximum.

Federal prosecutors largely agreed and said the court should just try and address the reporting violation.

Both sides must propose specific language concerning the new probation conditions by May 14.

Plaintiffs' attorneys representing wildfire victims decried the sentence for failing to punish PG&E and expressed concern that Alsup has pivoted from trying to hold the utility accountable to conceding to its demands.

PG&E has already said it cannot come into compliance with vegetation management policies for eight years, likely indicating more blazes this fire season, according to Dario de Ghetaldi of Corey, Luzaich, de Ghetaldi & Riddle LLP and Michael Danko of the Gibbs Law Group LLP -- both of whom took issue with PG&E's appointment of former Tennessee Valley Authority head William D. Johnson as chief executive officer.

"The real issue is whether an investor-owned utility can ever, without judicial intervention, put the lives of the people of California first," Danko said. He added that it is time for Alsup to appoint a trustee to run the utility.

Johnson, after the hearing, called the judge's sentence "wise."

Asked what message he would like to send to policymakers in Sacramento, the newly-appointed CEO said PG&E has "to be able to attract investors" since utilities are a "highly capital intensive" business.

"It's not for the company alone but for everybody," he said. "If we want clean, reliable, safe energy in this state, we need to get a little help on these things."