SAN FRANCISCO (AP) — Pacific Gas & Electric has emerged from a contentious bankruptcy saga that began after its long-neglected electrical grid ignited wildfires in California that killed more than 100 people.
The nation’s largest utility announced Wednesday it emerged from Chapter 11 bankruptcy and paid $5.4 billion in initial funds and 22.19% of its stock into a trust for victims of wildfires caused by its outdated equipment.
“This is an important milestone, but our work is far from over,” Bill Smith, PG&E interim chief executive officer, said in a statement. “Our emergence from Chapter 11 marks just the beginning of PG&E’s next era — as a fundamentally improved company and the safe, reliable utility that our customers, communities and California deserve.”
A federal judge last month approved a $58 billion plan for the company to emerged from bankruptcy by June 30, the deadline that the company had to meet to qualify for coverage from a $21 billion wildfire insurance fund created by California last year.
U.S. Bankruptcy Judge Dennis Montali’s decision cleared the way for PG&E to pay $25.5 billion for losses from devastating fires in 2017 and 2018.
Dozens of lawsuits were settled during the ordeal, with $13.5 billion earmarked for more than 80,000 people who lost family, homes, businesses and other property in the fires.
The company plans to find a new CEO to replace Bill Johnson, who stepped down June 30 after just 14 months on the job. It has overhauled its board of directors, including 11 members who were just recently appointed. PG&E also has committed to slicing up its sprawling territory into regional units to be more responsive to the different needs of the 16 million people who rely on it for power.
Financing the plan requires PG&E to nearly double its debt, saddling the company with a burden its critics fear will make it more difficult to raise the estimated $40 billion for improvements that the utility still needs to make to its electrical grid.
This marks the second time in 16 years that PG&E has navigated a complex bankruptcy case that has raised questions about how it should operate in the future. The last time the company emerged from bankruptcy, in 2004, electricity rates soared and management focused even more on boosting profits instead of upgrading its power supply.
Due to climate change, wildfires are set to become an increasing problem
Millions of acres burn every year in wildfires across the United States, with the worst seasons on record occuring in the past two years. Climate change is blamed for making these fires increasingly worse year-on-year, making things tough for power grid engineers in an increasingly volatile climate reality.
The average wildfire season today is three and a half months longer than it was as recently as the 1980s. The number of annual large fires in the US has tripled — burning six times as many acres as in wildfire seasons only decades ago.
Wildfires are occuring where they were rarely seen before
Temperature averages in Siberia were nearly 10°C above normal for the first five months of 2020. Temperatures in the Russian Arctic region and Siberia continue to break records, thawing the tundra and contributing to an increase of hundreds in wildfires, most in areas inaccessible by firefighters. Siberian wildfires today are breaking out over nearly 3 million acres (1.2m hectares). The smoke cloud is unprecedented, extending over the United States and Canada.
How power lines contribute to wildfires
There is growing evidence that power lines themselves trigger wildfires.
High winds are a key contributing factor, vegetation contact, where high winds blow trees and branches onto power lines, sparking fires. In other cases, wind can snap wooden distribution line poles, causing live wires to fall onto nearby dry grass, setting it on fire.
California is particularly at risk because of drought conditions that have turned its forests into tinderboxes from August to November, when high winds are common. The Redwood Fire burned more than 36,000 acres, destroyed hundreds of homes and businesses, and lead to nine deaths.
Introducing VECTO System – real time notifications the moment problems arise
Developed in Cape Town, South Africa, VECTO System is an innovative grid management system developed to meet Africa’s steep energy challenges. It is a solution in two parts – a device installed across the network, and a software platform that visualises the data and provides real time notifications when network performance moves out of accepted safety thresholds.
Each VECTO System device is a linux-based edge computer, which process data locally as it enters the device, while simultaneously streaming it onwards a central data store. With a built-in GPS clock that is time synchronised to within ±100ns from absolute time, the full fleet of devices work together in perfect harmony, delivering the full picture of network performance.
The VECTO 3 edge-computing measurement device records and reports on a comprehensive set of RMS, phasor, harmonic, environmental & synchrophasor data, encompassing over 9,000 parameters.
VECTO System’s data visualisation platform — VECTO Grid OS — reports and interprets the data for the end user. Available for all smart devices, VECTO Grid OS will notify the appropriate team members at the moment anomalies occur on the network. If storm clouds suddenly begin to form over the city and solar supply drops rapidly, VECTO Grid OS will send emergency push notifications and emails in real time to the people who matter.
Beyond emergency notifications, VECTO System’s unique capabilities can also:
- Provide interaction and control down to the mini-substation level, providing engineers and operators with unprecedented visibility and remote management of the entire enterprise.
- Predict, detect and prevent wildfires caused by high voltage power-lines.
- Provide detailed information and insights through an ongoing forensic record, enabling long-term decision making and informed capital investments.
Keen to know more?
VECTO System is set to change the way the power grid is managed. If you’d like to see more of what the system is capable of, speak to us.