PG&E claims no connection between rate increases and $2.2B jump in earnings
PG&E’s claim that its $2.2B jump in 2023 earnings is unrelated to recent rate hikes is drawing sharp scrutiny from Californians facing some of the highest electricity prices in the U.S. Commenters highlight how PG&E’s status as a regulated, investor-owned monopoly—combined with political influence, weak or captured regulators, and costly wildfire liabilities—creates perverse incentives to raise capital spending and profits while underinvesting in basic safety and maintenance. Many argue for public or municipal ownership of the grid, pointing to lower rates at public utilities and questioning why essential infrastructure is run for profit at all.
Earnings vs. Rate Increases
- Several commenters note the company is technically correct that a Jan 1, 2024 rate hike cannot affect 2023 earnings, but argue this framing hides that earnings are structurally tied to rates.
- Others point out recent rate increases in 2022–2023 and see a clear connection between those hikes and the $2.2B profit.
- Some argue that if 2023 profits are strong, PG&E’s justification that it “needed” 2024 hikes due to losses looks suspect.
Monopoly, Regulation, and Political Influence
- PG&E is described as an investor‑owned, regulated monopoly; rates and budgets are set through CPUC “General Rate Case” processes.
- One view: PG&E has very little autonomy; CPUC micromanages spending, and governors appoint CPUC commissioners, so the state effectively owns the outcome while blaming PG&E.
- Others emphasize PG&E’s lobbying and political donations, seeing regulatory capture and bipartisan protection rather than strict oversight.
Public vs. Private Ownership
- Many argue power distribution is a natural monopoly and should be publicly owned or at least run at cost, citing cheaper municipal utilities (e.g., SMUD, LADWP) as evidence.
- Counterpoints: nationalization would require taxpayers to provide capital, could reduce accountability, and politicians would then take the blame for failures.
- San Francisco’s effort to use eminent domain to create a municipal system is cited as a test case.
Customer Bills and Pricing Structure
- Numerous anecdotes of very high bills (e.g., ~$200/month for small apartments; peak rates ~70¢/kWh) and delivery charges vastly exceeding generation charges.
- Comparisons to other regions (Seattle, Germany, India, public utilities in WA) highlight PG&E’s much higher rates.
- High electricity prices make EV charging sometimes comparable to or more expensive than gasoline, undermining electrification incentives.
Safety, Wildfires, and Past Misconduct
- Commenters recap long histories of pollution, gas explosions, wildfire ignition, and alleged diversion of safety funds to executive compensation.
- There is concern that regulatory decisions (e.g., undergrounding lines vs. cheap maintenance fixes) maximize capital spending and investor returns instead of safety.
Broader Systemic Critiques
- Thread broadens into critiques of “profit at any cost,” fiduciary duty, and late‑stage capitalism, arguing concentrated corporate power plus weak regulation leads to exploitation and underinvestment in safety.