Dive Brief:

• The California Public Utilities Commission (CPUC) last Thursday proposed additional guidelines for utilities deploying wildfire-related public safety power shut-offs (PSPS) — including requiring them to re-energize affected areas within 24 hours after the conditions that required the shut-off have abated.

• On the same day, CPUC President Marybel Batjer issued a ruling identifying "serious deficiencies" with Pacific Gas & Electric's (PG&E) post shut-off weekly reports to the commission, saying the utility's performance in 2019 "was unacceptable and cannot be repeated in 2020."

• Comments on the proposed guidelines are due Feb. 19, and the CPUC expects to issue a proposed decision by May —​ right before California's next wildfire season begins.

Dive Insight:

California utilities shut off power to millions of customers during the 2019 wildfire season, with the majority in PG&E's service territory. The utility's 70,000-square mile service territory includes more high-fire risk areas than other IOUs in California, PG&E said in its wildfire mitigation plan filed with the CPUC last year. In late October, it shut off power to 975,000 customer accounts.

The implementation of the shut-offs has drawn criticism from regulators and California's Democratic Gov. Gavin Newsom. In November, Batjer issued a ruling ordering PG&E to show cause as to why it should not be penalized for not following communication protocols during the "ill-conceived, poorly planned" outages.

But the Thursday ruling is emblematic of the challenge regulators face in trying to keep the grid both energized and safe, Steven Weissman, lecturer at the University of California, Berkeley's Goldman School of Public Policy and former administrative law judge at the CPUC, told Utility Dive. There are trade-offs between giving utilities explicit requirements and preventing them from exercising their own judgment.

The proposed deadline, if approved, "might create a situation where the utilities can point fingers at the regulators and say, 'Don't blame us for the fact that perhaps an additional hazard occurred, or fire was sparked after the line was re-energized, because the commission made us do it,'" he said.

On the flip side, a standard like this could push utilities to figure out how they can staff up and what kind of technology they might need to re-energize communities in 24 hours —​ for example, having fully-trained employees on hand who could be available at a moment's notice if conditions arise requiring them to go out and inspect lines.

"Within limits, it's always possible to be faster, it's always possible to be safer —​ the question is, how much money are you willing to spend to do it?" Weissman said. 

The commission is likely working under the assumption that utilities can reduce the breadth of PSPS events, Michael Wara, director of the climate and energy policy program and senior research scholar at the Stanford Woods Institute for the Environment, told Utility Dive. PG&E is aiming to reduce the number of customers impacted by shut-offs by a third in 2020. But considering the scale of past outages, that would still leave a significant footprint to inspect before turning the power back on, he said.

The proposed guidelines would also require utilities to strengthen coordination with local groups by convening monthly meetings with tribal and local government entities, conduct PSPS exercises in areas that are the most prone to de-energization, and create a plan for helping especially vulnerable customers during the shut-offs.

In addition, the proposal touches on the electric transportation-related impacts of a shut-off. Utilities would need to create a "transportation resiliency taskforce" to identify corridors that need back-up generation, as well as craft a plan to ensure customers have access to electric vehicle charging before the 2021 wildfire season.

The CPUC, in May 2019, issued a set of guidelines creating a framework for how utilities should coordinate with emergency responders, water and communication providers, and other public safety partners during a shut-off. But regulators need to take a closer look at how these shut-offs can affect infrastructure and industries that are vulnerable to power loss, like oil refineries and chemical industries, Catherine Sandoval, associate professor at Santa Clara University School of Law and former CPUC commissioner, told Utility Dive.

"I think there needs to be far more analysis done on a more granular level about especially sectors that are particularly vulnerable to de-energization, so that we don't end up with widespread public safety issues," she said.

Meanwhile, SB 378 —​ proposed California legislation that would fine utilities for every hour of a safety shut-off that is deemed imprudent by the CPUC —​ cleared the California Senate last week.

The bill is credit-negative for California IOUs, Moody's Investors Service said in a report out Friday, "because it would impose additional costs and may deter them from using power shutoffs altogether," increasing wildfire risk.

If the bill had been adopted before PG&E's 2019 blackouts and the CPUC determined it had not executed them in a "reasonable and prudent manner," PG&E could have incurred fines to the tune of $550 million, with Southern California Edison and San Diego Gas & Electric receiving fines less than $40 million and $10 million respectively, Moody's analysts said.

CPUC President: PG&E weekly reports are 'fundamentally inadequate'

Separately, Batjer issued a ruling with additional directions specific to PG&E. This isn't the first time the CPUC President has raised concerns about PG&E's deployment of safety shut-offs —​ last October, she wrote a letter to PG&E Corp. President and CEO Bill Johnson, directing the utility to submit weekly updates on how it was improving the execution of its PSPS program.

But PG&E's weekly reports are "fundamentally inadequate" and failed to provide the CPUC safety officials with enough detail to conclude the utility had adequately prepared for the next wildfire season, she said.

"It is the CPUC's expectation that PG&E will invest the necessary resources to mitigate the need for, and scope of, future PSPS events," she said in the ruling.

Batjer instructed PG&E to submit details of its planned improvements and anticipated challenges to the CPUC within two weeks and create working groups with tribal and local governments in its service territory within the next month. In addition, the utility is required to update its PSPS protocols within 45 days.

PG&E has taken the requests and suggestions from the Governor's office, state agencies and customers seriously and is implementing them in real time, utility spokesperson Kristi Jourdan said in an email.

"We agree with President Batjer and the CPUC that improving the planning and execution of PSPS events is vitally important for our customers and communities, and we are diligently working every day to get better and to make those improvements before this year's wildfire season. We will respond to her ruling by the deadline," she said.

PSPS events can protect against wildfires but PG&E is keenly aware that they also disprupts lives —​ "even a perfectly executed PSPS event will impose hardships on individuals and communities, particularly those in vulnerable circumstances."

PG&E has invested in systems and operational processes to reduce the impacts and duration of the outages, "but there are areas of our PSPS operations and communications we must continue to improve for our customers," Jourdan said.