Massive PG&E power outage in San Francisco renews calls for publicly-owned utilities
After the holiday season power outages that affected more than 130,000 PG&E customers in San Francisco, some elected officials and those seeking higher office are demanding more accountability from PG&E.
Some are going as far as saying it's time for San Francisco to cut ties with PG&E. The idea isn't new, but the massive outage brought the concept back to light.
"It is time to end San Francisco's relationship with PG&E and have our own public utility," said State Senator Scott Wiener, who is also running for Congress. "I've seen my share of PG&E power outages in San Francisco, I've never seen anything like this. The scale of it, the length of it, the lack of information for hours and hours for the public."
Wiener proposed the idea in 2020, but the bill never made it to a hearing. He said he is planning to put forward new legislation that would allow for cities to break away from PG&E and form their own publicly-owned utilities.
"I don't want to sugarcoat it. It's going to be a huge fight to make PG&E publicly owned in San Francisco. But it's a fight worth having," Wiener said. "This is totally normal. Palo Alto has its own public utility. Sacramento has its own public utility. There are public utilities in the North Bay, in other parts of the state. There are various publicly owned utilities within the PG&E service area. We can do that here as well."
Although PG&E isn't the sole provider of gas and electricity in San Francisco, it manages the local distribution grid.
"In San Francisco, there is a lot of support among elected officials for public power," Wiener said. "In terms of the city of San Francisco, to be able to create a true public utility and purchasing PG&E's assets to do that, that has been tough. PG&E has been fighting that for decades."
Gubernatorial candidate Tom Steyer also says the blackout is an example of why the status quo is not sufficient anymore.
"The system is not working. We need to change the system," he said. "We need to get rid of the monopoly. Monopolies don't work."
Steyer says he would like to see better oversight and the introduction of more competition to the market so people could choose who their provider is.
"If that happens, all of a sudden, all of the new technologies that are available right now will be adopted by somebody, and that will drive down the cost at which they can deliver electricity, which means everybody else will have to compete to drive down the cost of electricity," he said. "There is an explosion of technology which is making competition possible in so many different ways."
Professor Severin Borenstein, the faculty director of UC Berkeley's Energy Institute at Haas, says a divorce is logistically possible but would be a lengthy and complex process.
"It would take many, many years, and it would be extremely expensive. PG&E would fight it, as they did with the creation of SMUD, the Sacramento Municipal Utility. That litigation went on for nearly a decade," he said. "Mostly, what happens when part of a utility is taken over is the municipal has to pay the utility for their equipment. Then they have to decide how much to pay. That disagreement goes to court, almost certainly, and takes years and years to sort out."
If that happens, he explained, a complete separation from PG&E isn't likely to be the final result, anyway.
"Even if they did, it's not like that new San Francisco utility would be completely divorced from PG&E, because PG&E would completely surround it and they would constantly be buying and selling power to one another," Borenstein said. "PG&E is a gigantic service territory. In fact, it's about the same size as all of New England."
But depending on who you ask, the trouble could be worth it.
"If they really think that the corporation — the investor-owned utility — is so incompetent and so badly run that it can't be salvaged, then I think it does make sense to at least put pressure on them. Talk of municipalization does put pressure on them," he said. "Could San Francisco actually run a better utility? Quite possibly. There are examples of very successful municipal utilities. SMUD is now one of them. But there also are plenty of examples of real failures."
Wiener and Steyer are suggesting different strategies, but they share the same sentiment.
"What happened in San Francisco was completely unacceptable," Wiener said.
"Come to the table and let's work this out as fast as possible," Steyer said.
CBS News Bay Area requested an on-camera interview with PG&E. A spokesperson provided two statements instead.
"PG&E has served customers in San Francisco for more than 100 years, and we remain committed to serving San Franciscans for years to come. To that end, PG&E has invested $3 billion in our electric grid in San Francisco from 2005 through 2025 to increase reliability, redundancy and emergency preparedness. Those investments have paid off for our customers: San Francisco has service that is almost twice as reliable as the national average among all utilities. Having said that, we know we have more work to do."
"PG&E's priority is delivering safe, reliable and clean energy to our customers at lowest possible cost. While national electric prices are projected to rise through 2026, PG&E has reduced residential electric rates three times since January 2024, offsetting increases in that period. Today, our typical residential monthly electric bill is $12 less than two years ago, and we anticipate another electric rate decrease for customers who get energy supply and delivery from PG&E in January, further reducing bills."
The utility company on Tuesday announced it would cut rates for 2026. It said beginning on Jan. 1, natural gas rates would go down 5%, and customers who get electricity and delivery from PG&E will also see a 5% decrease.