Dive Brief:

• Pacific Gas & Electric (PG&E) Corp. estimates its utility will "largely eliminate" wildfire-related safety shut-offs in five years, President and CEO Bill Johnson told members of the U.S. Senate Committee on Energy and Natural Resources on Thursday.

• Johnson repeatedly emphasized the role that climate change and weather events play in increasing fire risk, telling lawmakers that “you can have a perfectly sound system with everything working well” and strong winds could still blow a branch into a power line, sparking a wildfire.

• Committee Chair Lisa Murkowski, R-Alaska, addressed the impacts of wildfires on grid reliability during the Senate hearing. According to her, the issue is widespread in Western states, and Alaska has seen hundreds of power line-related fires in the past eight years.

Dive Insight:

PG&E’s service territory is uniquely exposed to climate impacts because of its geography and vegetation, Michael Colvin, director of California energy at the Environmental Defense Fund, told Utility Dive. But “there are definitely things that the utility could have done differently” to prevent wildfires. One strategy is to tailor mitigation measures to specific regions within the service area, he said. 

Johnson, who has previously told California regulators that the public safety power shut-off (PSPS) program could continue for the next decade, said the utility is improving its predictive capability and technology to narrow the scope and duration of the outages. But it will probably be five years before the utility can get to a point where it can “largely eliminate this tool,” he said, noting that San Diego Gas & Electric — another California utility that has faced wildfire risk in its service territory —​ still de-energizes portions of the grid from time to time.

“I think over the next couple of years, you’ll see a progression of shorter, fewer PSPS events,” Johnson said. “But the climate change and the weather change is dramatic enough that I don’t think we’ll see the end of it for a period of time.”

Given forecasts on weather and climate conditions, the risks necessitating PSPS are likely to get worse in the next few years, Michael Wara, senior research scholar at the Stanford Woods Institute for the Environment, told the committee. Transmission line failures in 2019 —​ such as the one that sparked the Kincade Fire —​ indicate that even high-voltage lines providing bulk system reliability may need to be de-energized.

“It would seem prudent based on recent experience to consider including all of these lines, perhaps except the very highest voltage lines, in these PSPS protocols —​ and that has potentially significant ramifications for bulk system reliability in California…” he said.

PG&E’s PSPS program, launched in the wake of devastating wildfires in Northern California in 2017 and 2018, has affected millions of customers and prompted widespread public, regulatory and political outrage in the state. While customers, including critical energy users like first responders, depend on electric service, the use of shut-offs has helped prevent fires, Johnson told the committee.

Focusing on wildfire prevention will not prevent PG&E from achieving California’s ambitious renewables goals in the long run, Johnson assured the committee, although it could require prioritizing system hardening and other measures in the short-term.

“I don’t think there’s any contradiction between being fire-safe and being carbon-free,” he said.

PG&E crossed a significant milestone in its bankruptcy proceeding this week, after receiving court approval for two settlement agreements totaling $24.5 billion to resolve a large chunk of its wildfire liabilities. The company has also lined up financing for the reorganized company that emerges from bankruptcy. But it’s still fending off take-over attempts from a group of its bondholders and there is continuing interest from San Jose and other cities to take over the utility. The owner of the reorganized company "will be determined by the bankruptcy court," Johnson said.

Ratepayers will not bear the costs of bankruptcy, according to Johnson, since the settlements will be funded by shareholders. However, customers will see some cost increases for system upgrades that were planned prior to the bankruptcy —​ which are “to the benefit of the customers, and they will have to help contribute to that,” he said.