Dive Brief:

• Pacific Gas & Electric (PG&E) cannot commit to contracting a specific number of tree-workers by a future date to conduct vegetation management work, the utility told a federal judge in a filing Monday.

• U.S. District Judge William Alsup, who is supervising PG&E's criminal probation period, asked utility lawyers to detail its plans for expanding its tree-trimming workforce at a hearing last month. But PG&E refrained from providing a specific number, saying that its vegetation management and wildfire mitigation efforts are "complex and continuously improving programs."

• Meanwhile, PG&E is planning to create local operating regions for some everyday gas and electric functions to ensure a closer connection with communities, PG&E Corp. President and CEO Bill Johnson told the California Public Utilities Commission (CPUC) last week. The utility will have a final proposal ready by June 30.

Dive Insight:

PG&E was placed under a five-year criminal probation, currently supervised by Alsup, related to the 2010 natural gas pipeline explosion in San Bruno, California. Alsup has considered requiring PG&E, as part of its probation, to hire its own workforce of tree-trimmers — rather than external contractors — to conduct wildfire mitigation work. At a hearing in February, he also asked PG&E to detail its plans for increasing its number of workers.

But the utility's wildfire mitigation efforts require flexibility and "failure to adapt could create safety risks rather than reduce them," PG&E said in its response, adding that it should not be forced to commit to a specific number of workers for one aspect of wildfire mitigation as it works with regulators and the California Department of Forestry and Fire Protection to effectively deploy its resources. 

Vegetation management is only one piece of a larger effort to reduce wildfire risk in its service territory, according to PG&E. The utility last month filed a wildfire mitigation plan with the CPUC — which needs to be approved by the agency's Wildfire Safety Division — outlining resilience strategies that are projected to cost around $2.6 billion annually through 2022. 

At the end of 2019, PG&E had around 5,500 tree-trimming personnel contracted, and expects to retain them as it completes pending work from last year. But the utility doesn't expect that number to remain constant after that, especially since "many of those tree trimmers are from out of state and cannot continue to remain available permanently."

However, PG&E does plan to expand the pool of qualified tree-trimmers in California. Specifically, the utility is aiming to train around 2,800 additional workers in 2021, and the pool will help replace out-of-state workers who are currently paid at much higher rates.

PG&E and regulators could learn more about vegetation management best practices from electric cooperatives, many of which have lower profit margins than the investor-owned utility, according to Keith Taylor, community economic development specialist at the University of California, Davis, and expert on utility cooperative governance.

"So long as policymakers do not pull in the electric cooperative association representatives to testify, we're not going to know about these other viable models," he told Utility Dive.

PG&E is also looking to localize some of its everyday gas and electric functions, parent company PG&E Corp. CEO and President Johnson told the CPUC last week. The CPUC is responsible for reviewing PG&E's bankruptcy exit plan — which also requires confirmation from the bankruptcy court — and launched an investigation last September to look into the ratemaking and other implications of the proposal.

"I think we have, over the years, gotten too far away from our customers," Johnson said at evidentiary hearings conducted at the CPUC last week, as per an agency transcript. He noted that the utility has a diverse territory and customers in Stockton and San Francisco might have different interests. Johnson predicts that the utility will create four to five regions, and is in the midst of determining how to divide them up.

The current thinking is to localize some functions, like responsiveness to customers, while others — such as transmission, for instance — would remain centralized.

"There's still a lot of work to do here. But if you think about our business, responsiveness to day-to-day customer needs, relighting pilot lights, opening up outage lines, the more locally you can do that, the better," Johnson said.