Magazine News Volume 69, Issue 3

A Monopoly over NorCal Power

Many consider Pacific Gas and Electric Company (PG&E) to have a monopoly, existing when an organization lacks competitors, in the electricity and natural gas market for  Northern and Central California.  While it may seem that, as a public utility, PG&E is the only source for energy, customers can purchase electricity from other companies if they do not want to purchase electricity from PG&E.  PG&E’s competitors include FirstEnergy, American Electric Power, Southern Company, Duke Energy, and Marin Clean Energy. Marin Clean Energy serves Contra Costa, Marin, Napa, and Solano counties, focusing on offering renewable energy options. According to Chris Foster, a media representative  at  PG& E, “We are not a monopoly at PG&E, we are an investor-owned utility.”  An investor-owned utility is a private enterprise  which provides an essential service such as utility. The California Public Utilities Commission regulates investor-owned utilities. One reason some consider PG&E a monopoly is its significant customer base, as it is one of the largest natural gas and electric energy companies in the United States and serves about 16 million people. Its powerlines extend from Eureka to part of Bakersfield. PG&E also provides clean energy through its hydroelectric system, and provides Diablo Nuclear Energy from the Diablo Canyon Power Plant. 

According to Mr. Foster, The California Public Utilities Commission is  responsible for regulating PG&E, protecting customers, safeguarding the environment, and ensuring residents and businesses are protected.” Specifically, the agency’s main regulation activities for PG&E  include authorizing rate changes, setting safety standards and rules, and resolving customer complaints.

However, PG&E’s actions are not without controversy. CPUC President Batjer expressed concern over  recent planned grid outages resulting in many residences and businesses without electricity access. President Batjer asserted that,  “‘Failures in execution, combined with the magnitude of this PSPS event, created an unacceptable situation that should never be repeated.  The scope, scale, complexity, and overall impact to people’s lives, businesses, and the economy of this action cannot be understated.” Approximately two million customers were affected by these outages. Similarly, activist Keith Brower Brown with the  East Bay Democratic Socialists of America, assails PG&E for its recent actions, concerned that the utility is not being sufficiently accountable to its customers:  “PG&E has been a disaster for working-class Californians and the environment. PG&E executives skipped safety work so they could pay out $4.5 billion to themselves and Wall Street investors. Meanwhile, the rest of us get huge fires, smoke in our lungs, and shutoffs for days,” Browser Brown said.